CUR 
TO 

PREDATORY 
WEALTH 


W.  V.  Marsha  li 


-v^' 


Digitized  by  the  Internet  Archive 

in  2007  with  funding  from 

IVIicrosoft  Corporation 


http://www.archive.org/details/curbtopredatorywOOmarsrich 


A  Curb  to 
Predatory  Wealth 

BY 

W.  V.  MARSHALL 


se(3oni?j.krii;tdn  REvrsjt) 


»    J*  ••/.•, ' 


R.  F.  FENNO  &  COMPANY 

NEW  YORK 


1<'^ 

^-^v 


Copyright.  1912 
By  W.  V.  Marshall 


PREFACE. 

Anti-trust  legislation  has  been,  so  far,  a 
complete  failure.  The  reason  for  this  is  that 
it  has  been  largely  of  the  nature  of  arbitrary 
prohibition.  There  has  been  no  attempt  to 
utilize  any  fundamental  principle  of  economics 
designed  to  appeal  to  the  voluntary  spirit. 

A  needed  measure  is  one  that  harmonizes 
with  that  basic  principle  of  business,  self-in- 
terest. Such  a  measure  is  the  graduated  prop- 
erty tax.  It  would  eliminate  the  trust  system 
through  rendering  it  less  remunerative  for  cap- 
ital to  be  invested  in  huge  monopolies  than  in 
independent  concerns. 

In  the  use  of  this  tax  no  distinction  is  to  be 
made  between  the  large  wealth  consisting  of  a 
combination  of  several  small  wealths  and  the 
large  wealth  belonging  to  the  individual.  The 
intent  is  to  apply  the  tax  to  overcapitalization 
wherever  found.  In  this  way  the  corrective 
portion  of  our  problem  is  solved. 

The  balance  of  our  problem  is  also  solved. 
Because  it  requires  no  change  in  the  present 
machinery  of  government  the  graduated  prop- 
iii 


250190 


iv  PREFACE. 

erty  tax  is  a  present  day  measure.    It  could  be 
adopted  at  once. 

In  connection  with  its  main  purpose  there  are 
other  advantages  that  would  attend  the  adop- 
tion of  the  Graduated  Property  Tax.  It  would 
would  give  birth  to  equality  of  opportunity.  It 
would  create  a  vast  improvement  in  the  meth- 
od, form  and  size  of  industrial  investments. 
These  and  other  correlated  benefits  would  be 
evolved  from  the  tax  as  natural  sequences,  and 
are  explained  in  connection  with  the  main  sub- 
ject in  the  body  of  the  book. 


In  preparing  the  second  edition  the  author 
has  carefully  revised  and  in  part  re-written  this 
work.  Three  new  chapters  have  been  inserted 
and  three  that  were  included  in  the  first  edi- 
tion have  been  omitted.  The  sequence  of  the 
remaining  chapters  has  been  slightly  altered  in 
order  to  make  the  presentation  of  the  subject 
more  logical. 

W.  V.  Marshall. 


CONTENT 

PAGE. 

CHAPTER  I.  SCOPE  AND  PURPOSE  OF  THE 
GRADUATED  TAX. 

Present  system  of  taxation  uniform.  Purpose  of 
graduated  tax  is  to  abolish  monopolies.  It  is  pro- 
gressive in  rate.  Unit  of  progression,  one  mill  on 
dollar  for  each  million.  Table.  Individual  stock- 
holdings assessed  on  total  capitalization  of  com- 
pany. Illustrations.  Affiliated  interests  counted 
in  valuing  company.  Illustrations.  Decentraliza- 
tion and  dissolution  of  trusts  into  small  independ- 
ent companies  would  follow il 

CHAPTER  II.  PRACTICAL  APPLICATION 
OF  THE  GRADUATED  TAX. 

Valuation  of  holdings  that  overlap  or  are  located  in 
various  districts.  Ilustration.  System  of  report- 
ing assessments  by  counties  to  state,  etc.  Proba- 
bly better  as  a  state  law.  Safeguarding  against 
states  with  no  graduated  tax.  Co-operation  of 
states  desirable i8 

CHAPTER  III.  THE  GRADUATED  TAX  A 
DISCRIMINATING  TAX. 

Low  capitalization  favored.  Trusts  could  not  defy 
it.  Examples  of  heavy  non-discriminating  tax 
now  in  use :  tax  on  liquor,  import  duties,  tax  on 
tobacco.  These  industries  prosper  for  no  one  has 
advantage.  Examples  of  discriminating  taxes : 
tax  on  state-bank  currency,  protective  tariff,  Swiss 
graduated  land  tax 22 

CHAPTER  IV.  SAFEGUARDING  INDEPEND- 
ENT CAPITAL. 

Property  exempt  from  graduated  tax.  Taxables 
should  be  assessed  at  actual  values.  Unrelated  in- 
vestments distinct  objects  of  taxation.  Guarding 
non-trust  capital  from  trust  tax.  Illustration. 
Distribution  of  wealth  among  enterprises  favored. 
Illustrations.    Resume 27 

V 


vi  CONTENTS. 

PAGE. 

Proposition  One. 

On  the  abolition  of  trusts  by  a  change  in  the  method 
of  taxation 33 

CHAPTER  V.  ADEQUACY  OF  CAPITALIZA- 
TION IN  INDUSTRIES. 

Point  of  highest  efficiency  in  industrial  enterprises. 
Disadvantages  of  over-large  plants :  cursory  at- 
tention from  owners,  administration  not  vested  in 
those  having  most  practical  knowledge,  policy  of 
superintendents  dictated  by  own  interests,  best 
work  not  done  by  men  without  possible  partner- 
ship as  incentive,  meagre  wages  cut  operatives  off 
from  culture 35 

CHAPTER  VI.  THE  DECENTRALIZING 
FUNCTION  OF  THE  GRADUATED  TAX. 

Capitalization  would  be  the  least  compatible  with  ef- 
ficiency. If  all  companies  in  an  industry  must  re- 
tain large  capitalization  there  would  be  no  dis- 
crimination in  favor  of  other  industries  demand- 
ing less  capital.    Illustration 41 

CHAPTER  VII.  THERE  SHOULD  BE  NO 
WAR  ON  CAPITAL  AS  CAPITAL. 

Capital  essential  to  trade.  But  it  should  be  a  servant 
and  not  a  tyrant.  Monoply  of  means  of  financing 
large  enterprises  leads  to  exploitation  of  the 
people.  But  under  the  graduated  tax  every  com- 
munity would  have  capital  for  its  own  enterprises.    44 

CHAPTER  VIIL  THE  GRADUATED  TAX  IS 
UNFAIR  TO  NONE. 

It  is  not  confiscatory.  High  rate  in  some  cases  could 
be  reduced  by  squeezing  water  from  capitalization. 
Also  by  resolving  combines  into  separate  organiza- 
tions.   Illustration 47 

Proposition  Two. 
On  the  abolition  of  trusts  and  the  preservation  of 
the  rights  of  capital 51 


CONTENTS.  vii 

PAGE. 

CHAPTER  IX.  THE  KIND  OF  COMPETITION 
THE  GRADUATED  TAX  WOULD  ABOLISH. 

Present  industrial  system  anomalous.  The  "few" 
are  secure  in  monopolies ;  the  "many"  compete 
among  themselves  for  bare  living.  Cut-throat 
competition  is  greatest  when  over-production  is  at 
maximum 53 

CHAPTER  X.    THE  KIND  OF  COMPETITION 
THE    GRADUATED    TAX     WOULD    EN- 
COURAGE. 
Free    competition   would    result    in    uniformity    of 
profit.    Law  of  demand  and  supply  in  selecting  oc- 
cupation.   The  equalization  of  merit  and  compen- 
sation.    Prevention  of  shut-downs  and  business 
depression.     Rivalry  would  be  friendly.     Benefits 
that  would  follow  graduated  tax 55 

CHAPTER  XL  FREEDOM  OF  COMPETITION 
ESSENTIAL  TO  PUBLIC  WELFARE. 

Each  individual  should  receive  compensation  accord- 
ing to  the  amount  of  wealth  he  has  created.  This 
can  be  determined  only  by  natural  adjustment. 
An  absolute  wage-scale  unjust  and  absurd.  Com- 
petition an  inviolable  natural  law  of  trade 60 

Proposition  Three. 
On  competition  as  a  natural  law 65 

CHAPTER  XIL  PREDATORY  METHODS  OF 
GAINING  WEALTH. 

Illustrated  by  the  methods  of  the  oil  interests,  the 
packing  interests,  the  railroad  interests  and  Wall 
Street.  They  are  careless  of  the  rights  of  the 
people.    Yet  they  dictate  national  policies 67 

CHAPTER  XIIL  BIG  BUSINESS  FOLLY  AND 
THE  COST  OF  IT. 

Exploitation  of  the  people  a  short-sighted  policy. 
Wealth  taken  from  the  people  reduces  their  pur- 
chasing power.  Is  useless  surplus  to  exploiters.    If 


viii  CONTENTS. 

PAGE. 

surplus  is  invested  abroad,  commodities  taken  in 
exchange  find  no  more  consumers.  Cause  of  over- 
production       72 

CHAPTER  XIV.  THE  "BIG  STICK"  OF  BIG 
BUSINESS. 

Panic  a  club  wielded  by  Interests  to  intimidate  the 
people.  Rendered  harmless  by  providing  those  out 
of  work  with  government  employment.  Society 
under  obligation  to  supply  work  to  idle.  Com- 
parison with  hospitals,  alms-houses,  etc 76 

Proposition  Four. 
On  the  incompatability  of  trust  methods  with  in- 
dustrial progress 81 

CHAPTER  XV.     SOME  MISCONCEPTIONS 
OF  ECONOMIC  PROBLEMS. 
Various  false  opinions  commonly  held  in  regard  to 
economic  problems.     The  plunderer   undermines 
his  own  position 83 

CHAPTER  XVI.  THE  FALLACY  OF 
ALTRUISM. 
Self-interest  is  self-preservation.  Is  strongest  im- 
pulse in  man.  Misapplied  self-interest  is  encroach- 
ment. Proposed  remedies :  altruism  carried  to 
logical  conclusion  would  exterminate  the  race; 
carried  less  far  would  be  ineffectual  for  good 86 

CHAPTER  XVIL  REGULATING  TRUSTS  BY 
FINES  AND  IMPRISONMENT. 

Fines  tend  to  become  a  means  of  retaliation  and  ex- 
tortion. Proved  to  be  impracticable.  Penal  laws 
have  become  dead  letters.  Both  methods  disre- 
gard principle  of  self-interest.  Graduated  tax 
makes  use  of  it. go 

Proposition  Five. 
On  the  use  of  self-interest  as  a  fundamental  prin- 
ciple of  human  conduct  in  curbing  trusts 95 


CONTENTS.  ix 

PAGE. 

CHAPTER  XVIII.     THE  GRADUATED  TAX 
VS.    THE    INCOME    TAX    AND   THE    IN 
HERITANCE  TAX. 
Income  tax  does  not  prevent  concentration  of  wealth 
Prying   into  private  affairs   obnoxious.     Income 
tax  not  reformatory.    Inheritance  tax  condones  an 
evil.    A  makeshift  measure 97 

CHAPTER  XIX.  THE  GRADUATED  TAX 
AND  THE  SINGLE  TAX. 
Same  in  principle.  Difference :  single  tax  on  land 
only,  graduated  tax  on  all  property.  Property  ex- 
empt by  the  latter.  Prevention  of  exploitation  of 
people  through  monopoly  of  land  not  enough. 
Other  monopolies  would  continue lOl 

CHAPTER  XX.  THE  GRADUATED  TAX  AND 
THE  PROTECTIVE  TARIFF. 

Founded  on  same  principle.  One  directed  against 
home  monopolists,  the  other  against  foreign.  Both 
discriminating.  One  supplements  the  other.  Tariff 
is  effective,  so  would  be  graduated  tax.  Protec- 
tion with  free  competition  within  our  borders  the 
ideal.    Quotations  from  Hamilton  and  Greeley. . . .  105 

Proposition  Six. 
On  the  equal  danger  of  foreign  and  home  monopolies,  iii 

CHAPTER  XXI.  THE  QUESTION  OF  CON- 
STITUTIONALITY. 

Equality  the  fundamental  principle  of  the  Constitu- 
tion. The  graduated  tax  ensures  this.  It  alone 
makes  for  equity  in  taxation 113 

CHAPTER  XXIL  SUBSIDIARY  REASONS. 
FOR  THE  GRADUATED  TAX. 

Large  wealth  better  able  to  pay  taxes.  It  imposes 
heavier  expense  for  preservation  of  the  peace.  It 
is  more  potential  for  profit  making.  Graduated 
tax  to  be  of  benefit  must  suppress  monopoly.  It 
would   equalize   the   distribution   of   wealth.    It 


X  CONTENTS. 

would  remove  all  hardship  from  taxation,  for  the 
latter  would  become  an  investment  in  public  utili- 
ties   ii6 

CHAPTER  XXIII.  QUESTIONS  ASKED  AND 
ANSWERED. 

1.  Rate  of  increase.  2.  Valuing  stock.  3.  Bonded 
and  non-bonded  corporations  in  the  competitive 
system.  4.  Effect  of  decentralization  on  railroads. 
5.  Public  expenditures.  6.  Effect  of  necessary 
price-adjusting.  7.  Taxes  regulate  industries.  8. 
Taxing  earnings.  9.  Capital  and  labor.  10.  New 
duties  for  the  state.  11.  Practicability  of  the 
tax.  12.  When  free  trade  is  safe.  13.  Import 
duties.  14.  Tainted  and  untainted  fortunes.  15. 
Necessarily  large  capitalization.  16.  Story  in 
brief I2I 

CHAPTER  XXIV.  SUMMARY  AND  CON- 
CLUSION. 
Summary  of  the  book.  Argument  in  brief.  Trusts 
would  not  tamely  acquiesce  to  the  measure.  A 
legal  battle  would  be  waged.  But  the  people  will 
achieve  economic  liberty.  It  is  a  part  of  evolu- 
tion. Graduated  tax  a  true  instrument  in  this 
evolution 129 

Proposition  Seven. 
Summary 135 


A  CURB  TO  PREDATORY  WEALTH. 


CHAPTER  I. 

SCOPE  AND  PURPOSE  OF  THE  GRADUATED  TAX. 

The  present  system  of  direct  taxation  in  the 
United  States  provides  for  a  simple  property 
tax  levied  at  a  fixed  rate  upon  the  estimated  or 
assessed  value  of  the  property.  The  progres- 
sive or  graduated  property  tax  differs  from  the 
present  system  in  that  it  provides  for  an  in- 
crease in  the  rate  of  taxation  as  it  applies  to 
the  increase  in  the  amount  of  owned  or  con- 
trolled wealth. 

The  particular  purpose  of  the  proposed  tax 
is  to  end  the  domination  of  the  trusts  by  ren- 
dering it  unprofitable  to  effect  combinations  of 
"predatory"  wealth. 

The  graduated  tax  here  presented  is  arith- 
metically progressive ;  that  is,  a  fixed  unit  of  in- 
crease is  added  to  the  initial  rate  of  taxation  for 
11 


12        A  CURB  TO  t>R£DATOR Y  WEALTH. 

each  successive  unit  of  increase  in  the  capitali- 
zation. In  actual  practice  the  unit  of  increase  in 
the  rate  and  the  unit  of  increase  in  the  capital 
would  be  fixed  by  statute,  but  the  initial  tax 
on  the  initial  unit  of  capital  would  be  deter- 
mined from  time  to  time  as  the  need  of  revenue 
varied.  The  units  of  progression  or  increase 
would  therefore  be  constant  while  the  initial 
rate  of  taxation  would  be  subject  to  change. 

To  illustrate  how  it  is  designed  to  increase 
the  tax  rate  with  increase  in  value  of  the  ob- 
ject of  taxation,  let  it  be  assumed  that  the 
statutory  unit  of  progression  in  the  rate  is  one 
mill  on  the  dollar,  and  that  the  unit  of  capital- 
ization is  one  million  dollars.  In  other  words, 
for  every  million  dollars  added  to  the  initial 
million  of  capitalization,  one-tenth  of  a  cent  is 
added  to  the  initial  rate.  Further,  let  it  be  as- 
sumed that  the  tax  as  determined  by  the  need 
of  revenue  is  one  cent  on  the  dollar  for  the  first 
million.  Then,  in  application  the  schedule 
would  run  as  follows : 

For  a  capitalization  of  one  million  dollars  the 
rate  of  taxation  would  be  one  cent  on  the  dol- 
lar; for  a  capitalization  of  two  million  dollars, 
one  and  one-tenth  cents  on  the  dollar;  for  a 
capitalization  of  three  million  dollars,  one  and 
two-tenth  cents  on  the  dollar.  The  scheme  is 
presented  succinctly  in  the  following  table : 


A  CURB  TO  PREDATORY  WEALTH. 


13 


TABLE  SHOWING  GRADUATED  TAXA- 
TION OF  PROPERTY. 


Unit  of  Increase 

Rate  of 

Tax  on 

Average  Rate 

in  Capitalization. 

Taxation. 

Each  Unit. 

of  Taxation. 

Total  Tax. 

First    $1,000,000 

.01 

$10,000 

.01 

$10,000 

Second  1,000,000 

.011 

11,000 

.0105 

21,000 

Third     1,000,000 

.012 

12,000 

.011 

33,000 

Fourth  1,000,000 

.013 

13,000 

.0115 

46,000 

Fifth      1,000,000 

.014 

14,000 

.012 

60,000 

Tenth    1,000,000 

.019 

10,000 

.0145 

145,000 

25th       1,000,000 

.034 

34,000 

.022 

550,000 

50th       1,000,000 

.059 

59,000 

.0345 

1,725,000 

100th     1,000,000 

.109 

109,000 

.0595 

5,950,000 

200th     1,000,000 

.209 

209,000 

.1095 

21,900,000 

300th     1,000,000 

.800 

309,000 

.1595 

47,850,000 

400th     1,000,000 

.409 

409,000 

.2095 

83,800,000 

500th     1,000,000 

.509 

509,000 

.2595 

129,750,000 

1000th  1,000,000 

1.009 

1,009,000 

.5095 

509,500,000 

This  ascending  scale  would  be  applied  to 
capitalized  enterprises  by  assessing  stockhold- 
ings or  ownerships  at  their  actual  values,  but 
taxing  them  at  the  same  rate  as  that  which  ap- 
plies to  the  total  value  of  the  body  of  wealth  or 
business  control  of  which  they  form  a  part. 

Let  us  take  as  an  illustration  the  vast  com- 
bination formed  by  the  Philadelphia  &  Read- 
ing and  associated  railroads  and  auxiliary  coal 
companies,  valued  at  scores  of  millions  of  dol- 
lars. The  stockholders  of  each  of  these  com- 
panies would  be  compelled,  under  the  method 
of  a  graduated  tax,  to  pay  upon  the  value  of 


14        A  CURB  TO  PREDATORY  WEALTH. 

their  personal  possessions  therein  at  a  rate 
per  cent,  corresponding  to  the  rate  on  the  sum 
of  the  total  value  of  the  combination. 

If  the  capitalization  of  a  trust  were  two  hun- 
dred million  dollars,  he  who  owned  one  million 
in  the  big  combination  would  be  required  to 
pay  taxes  on  that  million  dollars,  but  at  the 
two  hundred  million  dollar  rate ;  he  whose  in- 
terest in  the  concern  was  worth  more  or  less 
than  a  million  dollars  would  pay  on  the  greater 
or  lesser  amount  but  the  rate  would  remain  the 
same  as  on  the  two  hundred  millions. 

To  be  more  specific,  let  us  suppose  that 
George  F.  Baer,  the  leading  spirit  in  the  Phila- 
delphia &  Reading  Railroad  and  the  anthracite 
coal  monopoly,  possesses  in  his  own  right  and 
title  in  these  properties,  stock  or  other  evi- 
dences of  ownership  to  the  value  of  ten  million 
dollars.  By  the  proposed  plan  his  holdings 
would  be  assessed  at  their  actual  value  of  ten 
million  dollars,  but  the  tax  rate  on  these  hold- 
ings would  be  that  which  corresponded  to  the 
rate  on  the  total  valuation  of  the  monopoly. 
What  this  total  valuation  would  include  would 
depend  on  the  range  and  reach  of  the  Baer  ag- 
gregation. There  would  be,  to  start  with,  the 
Philadelphia  &  Reading  railway.  In  addition 
to  this  property  would  be  the  coal  beds,  worked 


A  CURB  TO  PREDATORY  WEALTH.        I5 

and  unworked,  company  stores  and  tenant 
houses,  city  retail  yards,  etc. 

Where  there  were  arrangements  with  other 
transportation  companies  for  the  fixing  of  rates 
and  supplying  of  cars,  and  understandings 
with  other  coal  companies  for  the  regulation  of 
prices  and  output,  the  valuation  of  the  trans- 
portation and  coal  companies  entering  into 
these  agreements  would  be  taken  into  consid- 
eration in  determining  the  basis  upon  which 
to  estimate  the  rate  of  taxation. 

All  property  controlled  by  the  Baer  monop- 
oly either  by  ownership,  lease,  agreement  or 
otherwise,  would  be  counted  for  making  up  the 
total.  The  aggregate  of  the  combined  assess- 
ments would,  no  doubt,  be  very  large,  but 
whatever  it  might  be  that  is  the  sum  which 
would,  under  the  method  of  the  graduated  tax, 
be  used  for  fixing  the  tax  rate  for  Mr.  Baer. 
If  the  combined  valuation  amounted  to  the 
sum  of  three  hundred  million  dollars,  Mr. 
Baer's  tax  rate  on  his  ten  million  dollars  would, 
under  such  a  schedule  as  that  tabulated  above, 
be  fifteen  and  95-100  cents  on  the  dollar. 

Necessarily  the  same  rule  applies  to  hold- 
ings of  any  size.  If  a  stockholder  of  the  Read- 
ing Railway  Company  owned,  say,  one  thou- 
sand dollars  worth  of  stock  and  had  no  further 
holdings  in  either  the  Reading  Railway  or  any 


16        A  CURB  TO  PREDATORY  WEALTH. 

of  its  subsidiary  or  allied  companies,  he  would 
still  pay  a  tax  on  his  thousand  dollars  at  the 
same  rate  as  Mr.  Baer  on  his  ten  millions,  viz., 
at  fifteen  and  95-100  per  cent. 

It  may  be  asked,  "To  what  degree  would  this 
method  of  classifying  and  taxing  plethoric 
combinations  of  capital  contribute  to  the  sup- 
pression of  monopolies?"  The  answer  can  be 
given  very  briefly. 

The  trade  monopolizers  themselves,  seeing 
that  such  a  system  of  taxation  would  render 
their  business  methods  obsolete,  would  be  in- 
capable of  impeaching  its  feasibility.  Instead, 
they  would  make  every  effort  to  create  belief 
in  the  desirability  of  continuing  the  present 
trust  system  and  in  the  disaster  that  would 
follow  its  dissolution. 

But,  upon  the  adoption  of  this  method  of 
trust  suppression  the  inevitable  would  occur. 
The  monopolists  would  soon  hustle  to  get  be- 
yond range  of  the  tax.  "Gentlemen's  agree- 
ments" would  be  quickly  consigned  to  the  past. 
Railroad  ownership  of  mining  companies  would 
be  brought  to  a  speedy  end.  Coal  combines  so 
huge  in  scope  as  to  be  hard  hit  by  the  gradu- 
ate tax  would  be  rapidly  dissolved  into  lesser 
possessions.  The  retail  selling  establishments 
would  be  no  longer  subjected  to  the  restric- 
tions of  the  combines,  but  would  be  left  to 


A  CURB  TO  PREDATORY  WEALTH.        17 

liberty  of  pursuit.  Decentralization  would  be 
the  universal  tendency  under  the  system  of  a 
progressive  property  tax  and  w^ould  grow  un- 
til the  huge  trusts  and  exploiting  combines 
were  resolved  into  fair-dealing,  and  in  truth 
more  efficent,  forms  of  moderate  size. 


CHAPTER  11. 

PRACTICAL  APPLICATION  OF  THE  GRADUATED  TAX. 

Shall  the  graduated  system  be  employed  for 
all  revenue  needs,  local,  county,  state,  and  the 
national  wants  above  that  supplied  by  the  tar- 
iff? Shall  the  levy  and  collection  be  by  county 
and  local  effort,  by  the  states,  or  by  federal 
machinery?  Shall  the  whole  tax  be  collected 
by  one  official  and  then  be  distributed  among 
the  counties,  states,  etc.,  or  shall  each  govern- 
ment entity  act  for  itself?  Problems  such  as 
these  must  be  examined  in  connection  with  the 
the  proposition  of  a  graduated  tax. 

In  a  bill  for  the  establishment  of  the  tax 
there  must  also  be  a  provision  for  the  proper 
valuation  of  holdings  that  overlap  or  are  lo- 
cated in  various  districts.  An  assessor  finding 
in  his  district  a  mining  or  manufacturing  plant 
which  extended  to  and  embraced  mines  or  fac- 
tories in  other  districts  would  have  to  know  the 
value  of  the  outside  concerns  in  addition  to 
that  in  his  own  district  before  he  could  fix  the 
correct  rate  of  tax  upon  the  property  lying 
18 


A  CURB  TO  PREDATORY  WEALTH.        19 

within  his  jurisdiction.  While  the  owner  of  a 
million  dollar  mining  interest  in  Pennsylvania, 
and  of  an  additional  two  millions  in  West  Vir- 
ginia would  be  subject  to  the  rate  that  applied 
to  a  three  million  dollar  property,  the  assessor 
of  the  district  in  which  the  first  property  lay- 
would  not,  in  the  absence  of  an  authorized  sys- 
tem of  listing  the  values  of  far  reaching  owner- 
ships, know  that  the  three  million  rate  was  ap- 
plicable to  the  case  in  hand.  The  various  prop- 
erties of  one  owner  would  therefore  have  to  be 
listed  together  for  the  purpose  of  determining 
under  a  progressive  system  what  rate  should 
apply.  Such  complete  listing  would  require 
county,  state  and  national  co-operation. 

By  a  system  of  reporting  from  the  county  to 
the  state  authorities  the  latter  would  obtain  the 
information  for  issuing  bulletins  to  the  county 
officials,  and  through  these  to  the  assessors, 
giving  values  and  kinds  of  ownership  in  differ- 
ent parts  of  the  state. 

By  similar  co-operation  between  the  state 
and  national  authorities,  returns  could  be  made 
concerning  all  the  properties  having  a  common 
owner  though  located  in  different  states. 

With  this  information  before  him,  together 
with  the  rate  of  increase  in  the  tax,  the  assessor 
would  be  in  a  position  properly  to  apportion 
the  tax  levy. 


20        A  CURB  TO  PREDATORY  WEALTH. 

The  graduated  tax  would  probably  be  sim- 
plified in  its  operation  by  its  adoption  as  a 
national  measure.  But  as  direct  taxation  is 
solely  a  state  prerogative  under  present  con- 
stitutional limitations,  its  separate  adoption 
by  the  several  states  might  be  better.  Were 
the  latter  course  resolved  upon,  concert  of  ac- 
tion on  the  part  of  the  states  would  be  desir- 
able as  the  trusts  would  take  advantage  of  lack 
of  concert  to  hinder  the  successful  operation 
of  the  measure  in  those  portions  of  the  country 
in  which  it  had  been  adopted. 

No  doubt  some  of  the  trusts  would  withdraw 
their  plants  from  states  in  which  they  were 
obliged  to  pay  a  graduated  property  tax,  and 
would  locate  them  in  states  which  they  could 
control,  and  then  endeavor  to  maintain  their 
trade  in  the  abandoned  territory  by  shipping 
their  goods  in  from  the  outside.  Under  such 
circumstances,  if  it  were  the  case  of  the  general 
government  against  a  foriegn  nation,  the 
remedy  would  be  a  tariff,  imposed  on  the 
trust  goods  imported.  But  as  it  is  contrary 
to  the  constitution  for  one  state  of  the  Union 
to  erect  a  tariff  against  another  state,  it 
would  be  necessary  to  find  some  remedy 
similar  in  its  effects;  that  is,  to  protect  a 
manufacturer  in  a  graduated  tax  state  from  the 
unfair  competition  resulting  from  the  importa- 


A  CURB  TO  PREDATORY  WEALTH.        21 

tion  of  the  products  of  a  trust  located  in  a  non- 
graduated  tax  state.  This  could  be  accomplished 
by  levying  upon  the  intra-state  merchants  that 
sold  the  extra-state  goods  a  graduated  tax 
upon  the  volume  of  sales  of  such  goods  at  the 
same  rate  that  would  apply  to  the  extra-state 
corporation  were  its  plant  located  in  the  state 
in  which  the  graduated  tax  was  in  effect.  With 
this  protection  the  home  manufacturers  and  the 
sellers  of  the  home  product  could  sustain  them- 
selves against  those  endeavoring  to  break 
down  a  provision  aimed  against  extortion. 

The  states  would  be  assisted  in  agreeing 
upon  the  afore-mentioned  concerted  action  by 
the  creation  of  a  delegate  congress  chosen  to 
assemble  at  some  point  and  formulate  legisla- 
tion recommended  for  adoption  by  the  states. 


CHAPTER  III. 

THE   GRADUATED   TAX   A   DISCRIMINATING   TAX. 

It  will  be  observed  that  the  proposed  tax  is  a 
discriminating  tax — one  that  bears  more  heavily 
upon  some  than  upon  others  in  the  same  pursuit. 

It  is  this  discriminating  feature  that  makes 
the  tax  prohibitive  for  trusts.  The  highly 
taxed  combine,  because  it  has  pitted  against 
it  in  the  same  line  of  business  a  merchant  or 
corporation  paying  a  low  tax,  is  forced  to  aban- 
don the  condition  which  brought  the  high  tax 
upon  it  and  conform  to  that  encouraged  by  the 
low  tax.  It  dare  not,  for  any  length  of  time, 
shift  this  heavier  tax  to  the  shoulders  of  the 
consumer  by  adding  it  to  the  price  of  the  pro- 
duct, since  the  low  taxed  dealer  stands  ever 
ready  to  supply  the  same  product  at  a  lower 
price  for  an  indefinite  period  of  time. 

So  obvious  is  it  that  the  predatory  trusts 
could  not  defy  a  tax  system  based  on  this  dis- 
criminating design  that  it  appears  to  be  hardly 
necessary  to  adduce  further  argument  in  sup- 
22 


A  CURB  TO  PREDATORY  WEALTH.        23 

port  of  this  contention.  And  yet  it  seems 
needful  to  do  so  in  order  to  combat  that  pessi- 
mistic notion  that  there  can  be  no  such  thing 
as  levying  a  heavier  tax  on  wealth,  and  keeping 
it  from  being  shifted  on  the  consumer.  This 
impression  is  very  prevalent  in  spite  of  the 
clearest  proofs  to  the  contrary,  and  comes  most 
likely  from  failure  to  take  note  of  the  differ- 
ence in  effect  between  a  tax  bearing  equally 
upon  all  in  similar  pursuits  and  one  bearing 
unequally. 

Both  systems  of  taxation  are  in  familiar  use, 
however,  and  they  afford  us  all  the  light  we 
need  on  the  subject.  We  are  told  by  these 
living  examples  that  a  non-discriminating  or 
straight  tax  is  an  easy  thing  to  bear,  just  as 
we  are  told  the  exact  opposite  in  the  case  of 
the  other  system. 

The  non-discriminating  tax  is  used  in  taxing 
spirituous  liquors.  The  distillers  are  taxed  at 
the  enormous  rate  of  one  dollar  and  ten  cents 
a  gallon  upon  every  gallon  of  their  product. 
But  all  engaged  in  this  manufacture  are  treated 
alike  in  the  taxation.  No  one  is  possessed  of 
such  an  advantage  over  the  others  in  the  matter 
of  tax  that  he  can  prevent  the  others  from  reim- 
bursing themselves  for  their  heavy  taxation. 
Consequently  there  is  no  restraining  influence 
to  deter  any  one.    All  make  profits  and  main- 


24        A  CURB  TO  PREDATORY  WEALTH. 

tain  themselves  as  if  they  paid  but  little  tax 
or  none  at  all. 

That  the  manufacturers  of  flour,  sugar,  and 
similar  staples  are  more  lightly  taxed  than  the 
distillers  makes  no  difference  to  the  latter,  in- 
asmuch as  the  high  prices  set  by  the  latter  on 
their  product  for  the  purpose  of  reimbursing 
themselves  do  not  drive  their  trade  to  those 
v^ho  do  not  manufacture  the  product. 

The  importation  of  foreign  goods  furnishes 
another  instance  of  heavy  but  non-discriminat- 
ing taxation.  The  importers  pay  a  rate  suffi- 
cient to  yield  the  bulk  of  the  immense  revenue 
of  the  national  government.  But  this  tax  be- 
ing impartially  exacted  from  both  large  and 
small  dealers,  the  importers  are  not  forced  into 
bankruptcy  nor  experience  more  than  the  ordi- 
nary difficulties  in  maintaining  themselves 
profitably  in  their  vocations. 

There  is  also  a  high  tax  on  the  tobacco  in- 
dustry, but  as  the  rate  is  uniform  the  business 
flourishes. 

So  it  is  with  the  tax  exacted  equally  from  all 
in  the  same  trade.  Since  no  one  has  any  ad- 
vantage over  his  rivals  in  rate  of  taxation  no 
one  can  prevent  the  others  from  reimbursing 
themselves  by  counting  the  tax  in  as  an  item  of 
expense  and  recovering  it  in  their  business. 

When  we  look  for  instances  of  the  discrim- 


A  CURB  TO  PREDATORY  WEALTH.        25 

inating  system  we  find  proof  equally  as  good, 
both  of  the  existence  of  the  system  and  of  its 
influence  for  repression.  A  marked  example 
of  the  system  and  its  method  of  working  is 
seen  in  the  banking  law  which  imposes  a  tax 
of  ten  per  cent,  upon  state  bank  currency  in 
favor  of  national  bank  currency.  Here  is  a 
discrimination  between  two  similar  commodi- 
ties in  favor  of  one  institution  to  the  detri- 
ment of  the  other,  both  of  which  desire  to  issue 
a  circulating  medium,  and  there  is  such  a  re- 
pressive influence  upon  the  state  banks  that 
they  are  forced  to  yield  to  it. 

The  protective  tariff  furnishes  us  with  an- 
other example  of  the  discriminating  system. 
Levying  upon  the  foreign  manufacturer  in 
favor  of  the  home  manufacturer  is  exercising 
partiality  between  those  desiring  to  supply 
similar  goods  to  the  American  market,  and  it 
obliges  the  foreign  concerns  largely  to  stand 
aside  in  favor  of  American  made  goods. 

The  graduated  land  tax,  adopted  in  Switzer- 
land and  the  Australian  colonies,  is  a  dis- 
crimination between  like  and  like  in  that  it 
acts  against  large  estates  in  favor  of  moderate 
landholding;  it  has  effectually  broken  up  land 
monopoly. 

In  these  practical  instances  it  is  made  mani- 
fest to  us,  in  plain  and  convincing  form,  that 


26        A  CURB  TO  PREDATORY  WEALTH. 

the  imposition  of  a  heavy  tax  untransferable 
to  others  is  not  an  untried  or  failing  experi- 
ment, but  a  problem  that  has  been  fully  met 
and  mastered.  They  demonstrate,  too,  that 
the  feature  insuring  success  is  that  of  the  tax 
bearing  heavier  upon  some  than  upon  others 
similarly  producing.  Such  forceful  evidences 
are  they  in  behalf  of  that  theory  that  they 
should  dispel  all  doubt  as  to  the  power  of  the 
graduated  property  tax  to  prevent  trustifica- 
tion and  exploitage. 


CHAPTER  IV. 

SAFEGUARDING  INDEPENDENT  CAPITAL. 

In  the  progressive  system  of  taxation,  as  ii\ 
any  other,  the  assessment  of  the  taxables  must 
be  made  to  harmonize  with  and  to  contribute 
to  the  main  object.  In  consonance  with  this 
idea,  then,  it  is  urged  that  it  would  be  well  to 
exempt  the  residences  and  household  posses- 
sions of  the  people  from  taxation,  since  they 
are  being,  unlike  the  rest  of  their  property, 
sources  of  expense  rather  than  profit  to  them, 
and  to  confine  taxation  entirely  to  the  preven- 
tion of  trust  formations,  as  intended  in  making 
the  tax  progressive. 

The  kind  of  property  upon  which  a  gradu- 
ated tax  would  be  levied  being  thus  indicated 
and  limited,  the  taxables  should  be  assessed 
at  their  actual  values.  This  would  be  neces- 
sary as  a  guard  against  that  failure  in  the  cor- 
rective influence  of  the  tax  which  would  en- 
sue from  more  or  less  undervaluing. 

To  further  carry  out  the  intent  of  the  pro- 
27 


28        A  CURB  TO  PREDATORY  WEALTH. 

gressive  tax  it  is  necessary  that,  when  the 
wealth  of  an  individual  is  invested  in  different 
and  non-related  enterprises,  each  investment 
be  treated  as  a  separate  and  distinct  object  of 
taxation.  This  has  as  one  of  its  objects  the 
guarding  of  the  non-trust  capital  from  trust 
taxation  in  the  case  of  the  capitalist  possessed 
of  both  classes  of  property.  If,  for  illustration, 
a  corporation  maintains  a  coal  combine,  and 
besides  this,  owns  and  conducts  an  independ- 
ent lumbering  establishment,  it  would  not  be 
in  accordance  with  the  scheme  of  the  graduat- 
ed tax  to  include  the  value  of  the  lumbering  in- 
terests of  the  stockholders  in  that  of  their  coal 
interests  when  taxing  them  for  maintaining  a 
coal  trust.  Manifestly,  for  trustifying  their 
coal  possessions  they  should  bear  the  brunt  of 
the  discriminating  feature  of  the  tax,  but  only 
upon  their  holdings  in  the  trust;  and  upon  their 
lumber  interest  they  should,  for  maintaining  it 
independently  of  a  trust,  be  tax-favored  to  the 
degree  of  being  required  to  pay  a  tax  rate  ad- 
justed to  the  value  of  the  lumber  business 
alone.  The  assessment  of  non-related  enter- 
prises as  separate  objects  of  taxation  would 
make  possible  the  disassociation  intended. 

The  treatment  of  unrelated  enterprises  as 
separate  objects  of  taxation  has  as  another  ob- 
ject to  afford  the  millionaire  an  opportunity 


A  CURB  TO  PREDATORY  WEALTH.        29 

to  escape  heavy  taxation  by  distributing  his 
wealth  into  many  and  various  enterprises  in- 
stead of  retaining  it  in  a  single  line  of  indus- 
try. Thus,  should  J.  P.  Morgan's  fifty  million 
dollar  capital  invested  in  some  single  line  be  a 
failing  venture  under  a  graduated  property  tax, 
the  method  of  assessment  would  make  it  prac- 
ticable for  him  to  decrease  the  accumulative 
effect  of  the  progressive  tax  by  allotting  a 
part  of  his  capital  to  maintaining  a  sugar  plant, 
part  to  a  flour  mill,  part  to  some  sort  of  steel 
manufacture,  and  part  to  such  other  enter- 
prise as  he  might  choose  to  invest  in  with  this 
immense  sum,  and  to  conduct  them  as  separate 
interests,  in  order  to  be  removed  from  the 
danger  of  confiscation  that  would  haunt  him 
on  account  of  the  concentration  of  a  mighty 
fortune  in  sole  control  of  a  great  business 
monopoly. 

To  provide  this  way  of  escaping  the  hard- 
ship of  the  discriminating  feature  is  in  exact 
accord  with  the  design  of  the  graduated  tax, 
for  that  design  is  not  to  raid  the  big  interests 
but  to  compel  the  big  interests  to  abandon  the 
system  employed  by  them  for  raiding  the 
people.  It  is  an  expedient  in  direct  unison 
with  the  theory  advocated,  for  it  emphasizes 
the  sense  in  which  the  tax  works  by  the  rule 
of  favor  as  well  as  forbiddance,  reward  as  well 


30        A  CURB  TO  PREDATORY  WEALTH. 

as  punishment,  and  it  gives  further  proof  of  the 
desirability  that  unrelated  industries  of  an  in- 
dividual be  treated  as  separate  entities  on  the 
tax  rolls. 


There  have  now  been  gone  over  the  points 
relating  to  the  purpose,  method  application,  and 
expected  developments  of  a  measure  intended 
to  guard  the  people  from  trust  domination. 
And  sufficient  has  been  disclosed,  we  believe,  to 
give  the  reader  an  idea  of  the  system  and  the 
possibilities  claimed  in  its  behalf.  As  a  resu- 
me of  this  phase  of  the  discussion,  then,  let  us 
question  ourselves  briefly  with  reference  to 
certain  of  the  broad  general  relations  of  the 
subject. 

What,  it  may  be  asked,  can  be  said  of  the 
power  of  the  graduated  tax,  or  lack  of  power, 
to  restrain  where  check  is  meditated?  The 
answer  is  to  be  found  in  the  success  of  the  dis- 
criminating taxes  already  in  extensive  use  in 
this  and  other  lands. 

What  of  its  ease  or  difficulty  of  application? 
The  answer  is  that  the  graduated  system 
amounts  to  nothing  more  than  a  modification 
of  our  present  system  of  common  property 
taxation. 

What,  then,  may  be  said  of  our  submission 
to  the  exactions  of  those  who  have  combined 


A  CURB  TO  PREDATORY  WEALTH.        31 

many  of  the  industries  of  the  country  into 
means  of  oppression?  The  answer  may  be 
succintly  and  fairly  expressed  as  given  in  the 
proposition  on  the  following  page. 


PROPOSITION  ONE. 

The  submission  of  the  common  people  to  ex- 
ploitation by  the  trusts  is  an  entirely  unneces- 
sary submission,  because  the  trusts  could  be 
successfully  curbed  simply  by  changing  our 
present  method  of  taxing  property. 


CHAPTER  V. 

ADEQUACY  OF  CAPITAL  IN  INDUSTRIES, 

The  advocates  of  monopolized  industry  en-^ 
deavor  to  justify  their  methods  with  the 
argument  that  the  larger  the  capital  invested 
in  any  industrial  enterprise  the  less  the  cost 
of  production. 

The  argument  is  v^rithout  substantial  basis. 
Capitalization  up  to  the  degree  of  adequacy  is 
the  point  at  which  the  highest  state  of  effi- 
ciency and  cheapening  of  cost  is  obtained  in 
production. 

Industries  which  lack  sufficient  capital  are 
naturally  at  a  disadvantage  as  compared  with 
concerns  equipped  with  sufficient  buildings, 
machinery,  tools,  raw  material  and  general 
working  means,  but  so  too  are  industries  which 
are  provided  with  more  than  sufficiency. 

The  owners  of  over-large  plants  or  com- 
bines can  give  only  cursory  attention  to  the  de- 
tails of  their  business,  leaving  the  real  manage- 
ment to  others  in  their  employ.  This  dele- 
35 


36        A  CURB  TO  PREDATORY  WEALTH. 

gated  responsibility  cannot  produce  the  best 
results  because  it  is  impossible  to  get  men  to 
take  the  same  interest  in  the  business  welfare 
of  others  that  they  take  in  their  own.  The  very 
nature  of  man  is  antagonistic  to  the  practice  of 
the  minutest  productive  economy  when  the 
fruits  of  his  toil  do  not  become  his  own,  and 
as  the  owners  of  enormous  concerns  cannot 
give  the  personal  attention  necessary  to  secure 
this  object  it  is  inevitable  that  waste  and  loss 
should  follow.  The  losses  due  to  the  lack  of 
strict  care  here,  the  allowance  of  a  small  waste 
there,  or  the  failure  to  get  the  most  out  of  the 
equipment — things  that  would  be  prevented  by 
a  proprietor  having  a  smaller  concern  over 
which  he  could  give  more  direct  supervision — 
go  to  make  up  a  very  large  sum,  when  reck- 
oned in  money,  that  must  be  deducted  from 
the  actual  earning  power  of  labor  and  capital. 

The  owners  of  vast  concerns  cannot  familiar- 
ize themselves  with  the  details  of  operation  to 
the  same  degree  as  agents  and  superintendents 
in  direct  contact  with  the  actual  work.  Yet 
they  are  supreme  in  directive  authority,  and 
their  subordinates,  although  they  may  be  ani- 
mated by  the  most  conscientious  desire  to  use 
their  knowledge  and  skill  to  the  best  interests 
of  their  employers,  are  bound  by  their  master's 
rules,  and  are  consequently  without  power  to 


A  CURB  TO  PREDATORY  WEALTH.        37 

adopt  the  better  methods  their  greater  fa- 
miliarity with  the  work  in  hand  fit  them  to 
prescribe.  From  this  ensues  another  kind  of 
waste — waste  of  the  superior  knowledge  and 
skill  which  the  superintendents  and  others  ob- 
tain from  close  contact  and  intimate  experi- 
ence with  the  industries  with  which  they  are 
connected. 

In  this  age  of  invention  and  mechanics  the 
practical  managers  are  quickest  to  discern  ad- 
vantages and  defects,  but  being  without  the 
authority  that  ownership  confers,  they  are 
often  obliged  to  retain  mechanisms  which  their 
better-grounded  judgments  tell  them  are  far 
from  being  the  best  that  could  be  employed. 
This  superiority  of  the  ability  to  control,  direct 
and  adapt,  then,  becomes  abortive  and  the  val- 
uable aid  that  practical  talent  would  lend  is 
largely  or  entirely  excluded  from  the  improve- 
ment and  cheapening  of  production. 

Self-interest,  moreover,  constructs  policies 
to  suit  the  situations  of  men.  It  is  to  the  super- 
tendent's  advantage  to  preserve  the  esteem  of 
the  proprietor  who  engages  him,  it  is  also  to 
his  advantage  to  maintain  the  good  will  of  the 
men  over  whom  he  exercises  control.  Good 
feeling  between  the  men  and  superintendent 
gives  the  proprietor  a  high  opinion  of  the  super- 
intendent's fitness  for  the  position  he  occupies. 


38        A  CURB  TO  PREDATORY  WEALTH. 

Thus  the  superintendent  is  protected  in  the  en- 
joyment of  his  position  and  salary — the  things 
of  greatest  importance  to  him.  But  it  is  a 
fact  that  the  good  will  between  the  superin- 
tendent and  men  may  depend  upon  favoritisms 
fatal  to  the  best  and  most  economical  produc- 
tion. 

The  superintendent  may  find  it  to  his  ad- 
vantage to  flatter  his  master  upon  the  latter's 
exercise  of  a  judgment  that  is  far  from  being 
sound.  By  so  doing  he  attaches  himself  more 
firmly  in  the  esteem  of  a  vain  employer  and 
profits  thereby,  and  while  such  conduct  serves 
to  promote  the  interests  of  the  superintendent 
and  is  only  the  exhibition  of  a  natural  motive, 
it  does  not  conduce  to  the  cheapening  of  pro- 
duction. 

Extending  our  consideration  to  the  common 
workmen  we  fail  to  find  superiority  of  merit 
in  a  system  which  increases  the  number  of 
those  deprived  of  the  incentives  of  ownership. 
It  only  multiples  the  number  of  operatives  who 
are  interested  more  in  saving  their  strength 
than  in  putting  forth  energy  and  ingenuity  in 
the  creation  of  cheaper  and  better  supply. 

This  is  not  all.  Coupled  with  the  ineffi- 
ciencies growing  out  of  repression  and  indiffer- 
ence are  those  resulting  from  weakness  of  mind 
and  body.    The  meager  wages  which  the  mon- 


A  CURB  TO  PREDATORY  WEALTH.        39 

opolists  frequently  compel  their  men  to  accept 
shuts  them  out  of  schools,  churches,  and  the 
avenues  to  advancement  and  culture.  That 
this,  in  the  long  run,  produces  inefficiency  in 
the  workers  needs  no  argument  to  establish. 
It  is  only  necessary  to  add  that  this  is  another 
of  the  weakening  factors  born  of  centralized 
over-growth,  and  that  it  greatly  increases  the 
cost  of  production ;  to  such  extent  is  this  true 
that  monopolies  would  not  be  self-sustaining 
did  not  the  destruction  of  competition  enable 
them  to  secure  illegitimate  profits. 

The  influx  of  capital  into  an  industry  has  the 
effect  of  cheapening  its  products  until  the  ade- 
quate amount  has  been  reached.  But  when 
there  is  enough,  success  is  marred  by  the  addi- 
tion of  more.  If  the  manufacture  of  a  given 
line  of  commodities  is  divided  among  a  number 
of  independent  manufacturers,  all  having  the 
modern  facilities  for  doing  work,  the  result  will 
be  the  production  of  wares  upon  the  least  basis 
of  cost.  This  follows  because  there  will  be 
a  large  number  of  proprietors  devoting  their 
individual  time  to  directly  overseeing  the 
work;  because  salaried  superintendents  not 
directly  interested  in  the  profits,  being  no  long- 
er needed,  will  be  dispensed  with  as  chief 
managers;  because  the  direct  contact  of  em- 
ployers  and   men,   as  well   as   the  better  re- 


40        A  CURB  TO  PREDATORY  WEALTH. 

muneration  the  latter  will  receive  on  account 
o?  the  increased  demand  for  labor,  will  secure 
tlie  earnest  effort,  hard  work,  and  united  well 
wishes  of  the  employees;  because  many  em- 
ployees will  themselves  become  thrifty  stock- 
holders in  the  concerns  and  will  have  all  the  in- 
terest in  the  success  of  the  concerns  that  own- 
ership creates. 

These  are  facts,  and  they  are  facts  disclos- 
ing such  hostility  to  colossal  aggregation  in 
industrialism  as  to  stand  by  themselves,  ex- 
clusive of  the  consideration  of  price  control 
and  other  factors,  as  a  vehement  protest  against 
undue  concentration. 


CHAPTER  VI. 

THE  DECENTRALIZING   FUNCTION   OF   THE   GRADU- 
ATED TAX. 

A  QUESTION  that  naturally  suggests  itself  here 
is,  how  far  would  the  graduated  property  tax 
as  a  cure  for  swollen  capitalization  carry  the 
work  of  decentralization? 

It  may  be  confidently  answered  that  this  tax 
would  have  effect  of  reducing  industrial  plants 
to  the  minimum  of  size  compatible  with  com- 
pleteness of  equipment  and  working  facilities. 
In  other  words,  it  would  decentralize  to  the 
point  of  resolving  the  vast  railroad  mergers  of 
the  present  into  separate  units  or  systems  in- 
dependently operated;  to  the  point  of  institut- 
ing among  factory  operators  custom  of  capital- 
izing their  plants  at  nearly  uniform  sums 
which  will  be  as  low  as  possible  but  still  com- 
patible with  perfect  equipment  and  operation; 
to  the  point  of  securing  to  enterprises  of  a 
similar  nature  a  fairly  equal  financial  backing, 
which  would  always  be  as  small  as  may  be 
41 


42        A  CURB  TO  PREDATORY  WEALTH. 

consistent  with  ample  trade  needs;  of  sub- 
stituting in  the  industrial  system  of  the  nation 
unit  plants  of  adequate  size  distributed  about 
the  country  in  many  and  convenient  centers  of 
industry  for  the  overgrown,  cumbrous  organi- 
zations now  located  in  but  few  and  scattered 
centers  of  industry. 

Beyond  this,  the  minimum  of  productive  effi- 
ciency, decentralization  would  not  go,  for  any 
attempt  to  operate  with  lesser  means  would  be 
attended  with  shortcomings  and  drawbacks  not 
to  be  compensated  for  by  a  greater  saving  of 
tax. 

It  may  now  be  noted  that  at  this  stage  of  the 
decentralizing  process  there  would  be  no  dis- 
crimination. This  would  be  so  for  the  very 
good  reason  that  the  industry  of  reduced  pro- 
portions, though  in  some  cases  necessarily  still 
large,  would  be  without  a  smaller-sized  com- 
petitor that  would  be  an  object  of  tax-favor. 
The  steel  plant,  the  capitalization  of  which 
would  be  large  even  under  the  full  operation 
of  the  graduated  tax,  would  be  at  no  disad- 
vantage on  account  of  the  lighter  tax  enjoyed 
by  the  small  store,  flour  mill  or  farm  in  its 
vicinity,  for  the  latter,  having  no  relation  to  the 
steel  industry,  would  not  be  competitors  of  the 
former  and  could  not  use  the  difference  in  their 
tax  rates  as  a  means  of  ruining  the  business 


A  CURB  TO  PREDATORY  WEALTH.        43 

of  the  steel  plant.  The  large  and  heavily-taxed 
industry  would  have  a  natural  monopoly  up  to 
the  point  of  its  minimum  of  size  for  successful 
work  and  on  that  account  it  would  be  privileged 
to  recover,  by  the  proper  adjustment  of  prices, 
sufficient  to  recoup  itself  for  the  extra  tax  col- 
lected from  it.  While  the  recovery  could  not  be 
more  than  was  just  sufficient  for  recoupment, 
owing  to  the  competition  of  sister  concerns,  it 
would,  on  account  of  the  absence  of  more  light- 
ly taxed  producers  of  similar  goods,  be  all  that 
was  needed.  As  the  system  of  progressive  taxa- 
tion would  work  out  thus  in  actual  practice,  the 
heavier  tax  levied  upon  the  industry  unavoid- 
ably large  would  no  more  be  felt  as  a  burden 
by  it  than  the  weightier  tax  which  is  now  im- 
posed on  the  whiskey,  the  tobacco,  and  the 
import  interests  is  felt  by  them. 


CHAPTER  VIL 

THERE  SHOULD  BE  NO  WAR  ON  CAPITAL  AS  CAPITAL. 

Condemning  the  misuse  of  wealth  is  not  mak- 
ing war  on  capital.  Capital  is  essential  to  pro- 
duction and  trade,  and  the  fact  that  it  is  es- 
sential makes  it  of  paramount  importance  that 
it  be  properly  used.  It  should  be  employed  as 
the  instrument  of  man's  effort  to  facilitate  his 
progress  and  to  add  to  his  comforts  and  joys, 
instead  of  being  converted  into  a  synonym  of 
greed  destined  to  hinder,  disturb,  oppress,  tor- 
ment and  starve.  It  should  be  a  servant  at  the 
disposition  of  all  instead  of  a  tyrant  at  the  dic- 
tation of  a  few.  Hence  to  object  to  its  use 
as  an  instrument  of  exploitation  and  robbery 
is  not  to  find  fault  with  the  endeavor  honestly 
to  accumulate  wealth.  Under  a  system  that 
paralyzes  every  effort  of  the  small  producer 
and  that  looks  to  the  building  of  great  fortunes 
by  the  ruin  of  many,  there  can  be  no  accumu- 
lation except  in  so  far  as  it  is  the  product  of 
plunder. 

U 


A  CURB  TO  PREDATORY  WEALTH.        45 

For  the  development  of  great  enterprises 
capital  must  be  invested  in  large  sums,  but  it 
is  not  an  inexorable  law  of  progress  that  suffi- 
cient capital  cannot  be  obtained  v^ithout  in- 
genious manipulation  at  the  hands  of  clever 
but  unprincipled  financiers.  On  the  contrary, 
it  is  eminently  feasible  and  practicable  to  have 
a  perfectly  honest  accumulation  of  capital  for 
the  creation  of  vast  enterprises.  And  there 
w^ould  be  vastly  more  initiative  and  improve- 
ment than  there  is  now,  if  honesty  in  accumu- 
lation replaced  dishonesty  and  if  the  people 
were  protected  in  their  just  dues. 

The  exploiters  have  a  monopoly  of  the 
means  of  financing  our  costly  enterprises  be- 
cause their  system  of  plundering  enables  them 
to  absorb  the  means.  Permit  the  people  to  re- 
tain their  earnings  in  full  and  large  enterprises 
would  be  just  as  quickly  financed  as  now,  but 
it  would  be  done  by  the  people.  It  is  the  nature 
of  money  to  gravitate  to  quarters  where  most 
wanted  because  it  yields  there  the  largest  re- 
turns. Consequently  under  an  equable  sys- 
tem of  industry  and  trade,  large  enterprises 
would  be  more  plentiful  than  now,  with  this 
difference,  moreover,  that  investments  would 
be  distributed  fairly  and  honestly  among  a 
great  number  of  stockholders  both  large  and 
small  found  in  every  station  of  life. 


46        A  CURB  TO  PREDATORY  WEALTH. 

There  is  no  reason,  except  the  desire  of  cap- 
italists to  plunder  the  people,  why  every  com- 
munity should  not  furnish  the  capital  for  the 
construction  and  ownership  of  all  its  enter- 
prises. Permit  the  common  people  to  retain  a 
fair  hold  upon  their  wealth  and  communities 
will  take  care  of  their  own  enterprises  in  a 
manner  that  will  result  in  the  establishing 
of  local  manufacturers,  of  individual  owner- 
ship of  homes,  and  of  the  development  of 
the  whole  country  to  the  general  enrichment 
of  the  people.  Plutocratic  ownership  of  every- 
thing worth  having,  converted  into  means  of 
plunder  and  oppression,  is  not  indicative  of  a 
normal  state  of  affairs.  It  is  simply  the  out- 
growth of  the  supremacy  of  greed. 


CHAPTER  VIII. 

C  THE  "graduated  TAX  IS  UNFAIR  TO   NONE. 

Although  the  graduated  property  tax  bears 
outwardly  a  sinister  aspect  toward  great 
wealth,  its  consequences  and  corollaries  reveal 
it  to  be  most  fair  to  the  possessors  of  large 
fortunes.  It  is  true  that  the  tax  would  sound 
the  death  knell  to  that  species  of  capitalistic 
combination  constituting  plundering  devices, 
by  rendering  it  unprofitable  tc  organize  indus- 
trial establishments  in  trade-monopolizing  pro- 
portions, but  the  fact  that  the  tax  is  a  trust 
whipper  does  not  signify  that  there  is  no  way 
to  avoid  the  result  of  its  confiscatory  tendency. 
For  there  are  various  ways  by  which  the  mon- 
opolists, acting  under  the  exigencies  imposed 
by  the  graduated  tax  remedy,  could  effect  vast 
reductions  in  the  tax  rate  with  which  their 
possessions  would  be  threatened  under  their 
present  state. 

One  of  the  ways  open  to  them  would  be  to 
squeeze  the  water  out  of  their  capitalization. 
47 


48        A  CURB  TO  PREDATORY  WEALTH. 

They  could  say  to  the  possessors  of  the  un- 
justified stock  certificates,  "You  received  this 
stock  without  value  given,  and  you  have  profit- 
ed all  these  years  from  its  worth  as  a  dividend 
producer ;  you  should  now  be  satisfied  to  have 
it  go  into  the  incinerating  furnace." 

By  cutting  down  a  two  hundred  million  dol- 
lar consolidation,  composed  half  of  water,  to 
its  actual  value  of  one  hundred  million  dollars, 
the  tax  would  be  reduced,  under  such  a  sched- 
ule as  that  given  in  the  table  in  Chapter 
One,  from  a  rate  of  ten  and  95-100  cents  on 
the  dollar  to  a  rate  of  five  and  95-100  cents  on 
the  dollar. 

A  second  means  of  reducing  the  tax  would  be 
to  dissolve  monster  aggregations  into  the  sev- 
eral corporations  of  which  they  were  com- 
posed. 

The  controllers  of  a  one  hundred  million  dol- 
lar combination  composed  of  a  half  dozen 
separate  coal  mining  operations,  for  instance, 
could,  by  dividing  these  plants  among  them- 
selves and  conducting  them  as  independent  en- 
terprises, effect  another  reduction  of  their  tax 
rate,  say  from  five  and  95-100  cents  to  two 
cents  on  the  dollar. 

If,  after  this  division,  it  were  found  that  the 
plants  were  still  so  overlarge  and  tax-burdened 
as  to  need,  for  good  business  policy,  still  fur- 


A  CURB  TO  PREDATORY  WEALTH.        49 

ther  division,  this  could  be  effected  and  the 
tax  brought  to  as  low  a  rate  as  one  cent  or  one 
cent  and  a  fraction  on  the  dollar. 

When  tax-saving  had  been  perfected  by  re- 
ducing the  industries  to  the  smallest  size  com- 
patible with  completeness  of  resources,  equip- 
ment and  working  facilities,  the  combinations 
of  wealth,  previously  under  the  restraint  of  a 
forbidding  tax,  would  now,  since  their  disso- 
ciation, be  left  unhampered,  owing  to  the  fact 
that  the  progressive  tax  could  no  longer  dis- 
criminate against  them. 

Seeking,  therefore,  not  to  institute  poetic 
justice,  but  only  to  render  it  impossible  for 
great  wealth  to  group  into  gigantic  looting  con- 
spiracies, and  not  denouncing  fortunes  as  for- 
tunes, but  giving  the  John  D.  Rockafellers 
of  finance  opportunity  for  the  retention  of  their 
riches,  in  forms  conducive  to  the  common  good, 
the  graduated  property  tax  would  realize  for 
the  usual  victims  of  monopoly  the  benefits  of 
a  square  deal  through  assuring  to  the  captains 
of  finance  a  similar  consideration. 

In  view  of  the  tolerance  of  the  described 
system  toward  large  wealth,  what  may  be  said 
of  our  resignation  to  the  specified  rapacity. 
The  reality  may  be  squarely  affirmed  as  in 
proposition  Two. 


PROPOSITION  TWO. 

The  submission  of  the  common  people  to  exploi- 
tation by  the  trusts  is  a  totally  inexcusable 
submission,  because  the  trusts  could  be  abol- 
ished without  real  harm  to  any  interest. 


CHAPTER  IX. 

THE  KIND  OF  COMPETITION  THE  GRADUATED  TAX 
WOULD  ABOLISH. 

Our  present  industrial  system  presents  this 
anomalous  picture — the  "few,"  the  great  mon- 
opolists, exempt  from  competition,  controlling 
the  staple  industries,  side  by  side  with  the 
many,  competing  with  each  other  for  employ- 
ment or  in  the  remaining  and  less  important 
industries. 

What  kind  of  competition  the  struggle  of  the 
many  to  exist  and  prosper  under  the  condition 
of  lessened  opportunity  entails  we  may  see 
by  looking  around  us.  We  see  that  it  is  marked 
by  strife  and  conflict,  by  antagonism  among 
the  masses  crowded  into  the  pursuits  not  yet 
monopolized.  We  witness  further  the  endeav- 
or of  monopolists  to  make  three  lagging  indus- 
tries thrive  when  two  would  have  prospered 
had  the  capital  of  the  third  been  left  with  the 
people  to  develop  trade  to  match  the  two.  We 
behold  the  rivalry  of  producers  trying  to  make 
53 


54        A  CURB  TO  PREDATORY  WEALTH. 

sales  among  a  class  that  has  been  robbed  of  its 
means  of  purchasing,  the  competition  of  money- 
lenders to  find  borrowers  when  the  people  have 
become  aware  that  the  returns  of  production 
do  not  equal  the  expenditure ;  the  desire  of 
owners  to  sell  their  homesteads  to  avoid  fore- 
closure ;  the  competition  of  laborers  for  the  op- 
portunity to  work  when  the  minor  industries 
cannot  afford  to  hire  and  the  trusts  have  a 
plethora  of  workmen. 

We  observe  that  this  competition  is  fiercest 
when  overproduction  has  reached  the  maxi- 
mum and  when  merchants  are  doing  their  best 
to  unload  left-over  goods  upon  the  impover- 
ished people  in  exchange  for  the  savings  of 
former  days,  either  accumulated  or  inherited; 
that  this  competition  is  attended  by  low  prices, 
commercial  failures,  foreclosures,  riot  and  ra- 
pine— the  inevitable  outcomes  of  the  malad- 
justments imposed  by  an  unnatural  distribu- 
tion of  earnings. 

This  kind  of  competition,  retrogressive  and 
ruinous  in  its  consequences,  is  an  amorphus 
creation  of  the  trusts  and  would  be  displaced, 
under  the  workings  of  a  progressive  tax,  by  a 
competition  of  the  legitimate,  wholesome  type 
presented  in  the  next  chapter. 


CHAPTER  X. 


THE  KIND  OF  COMPETITION  THE  GRADUATED  TAX 

I 
WOULD  ENCOURAGE. 


The  character  of  the  competition  which  the 
graduated  property  tax  would  encourage  and 
set  in  operation  may  best  be  shown  by  outlin- 
ing the  general  results  that  would  ensue  if 
competition  were  allowed  to  work  unimpeded 
by  trust  restriction. 

Free  and  unhampered  competition  would  in 
the  first  place  bring  about  an  equalization  of 
profitableness  in  the  different  trades  and  busi- 
ness ventures. 

To  understand  why  this  would  be  so,  we 
have  but  to  call  to  mind  that  the  natural  im- 
pulses of  men  lead  them  to  ally  themselves 
with  such  enterprises  as  happen  from  one  cir- 
cumstance or  another  to  be  most  profitable, 
and  that  in  an  unhindered  state  of  competi- 
tion this  impulse  would  have  full  and  free 
exercise  instead  of  being  curbed  by  monop- 
olistic organizations. 

55 


56        A  CURB  TO  PREDATORY  WEALTH. 

But  since  the  abandonment  of  the  less  re- 
munerative pursuits  for  the  more  profitable 
ones  would  bring  about  increased  remunera- 
tion in  the  pursuits  so  abandoned,  and  would 
also  cause  a  corresponding  decrease  in  profit- 
ableness of  the  preferred  occupations,  it  is  evi- 
dent that  a  balance  would  be  reached  at  which 
there  would  no  longer  be  any  enterprises  of 
low  profit  that  could  be  discarded  for  better 
paying  ones.  Hence,  the  one  certain  effect  of  a 
free  and  unrestricted  right  to  compete  is  equal- 
ity of  rate  of  profit  in  all  industries. 

If  competition  were  freed  of  the  throttling 
hand  of  the  monopolies  another  result  would 
be  the  equalization  of  demand  and  supply. 
In  corroboration  of  this  statement  we  have 
only  to  remember  that  the  less  remunerative 
occupations  are  the  ones  whose  products  ex- 
ceed demand ;  also  that  the  more  remunerative 
pursuits  are  the  ones  whose  products  fall  short 
of  the  demand.  It  is  evident,  therefore,  that 
should  people  desert  the  less  profitable  for  the 
more  profitable  pursuits  until  the  rates  of 
profit  were  equalized,  they  would,  by  the  very 
same  process,  have  caused  supply  to  equal  de- 
mand, and  thus  have  prevented  both  overpro- 
duction and  underproduction. 

Moreover,  unhampered  competition  would 
make  for  equality  between  merit  and  compen- 


A  CURB  TO  PREDATORY  WEALTH.        57 

sation.  This  comes  as  a  natural  sequence  to 
the  equalizing  of  profitableness.  Since  none 
would  be  compensated  at  a  greater  rate  per 
cent,  than  another  under  the  fostering  influ- 
ence of  free  conditions  for  competition,  the 
amount  of  compensation  that  would  be  meted 
out  to  any  worker  engaged  in  the  creation  of 
commodities  or  in  distributing  them,  would 
be  gauged  by  the  actual  local  value  of  those 
commodities. 

With  competition  rendered  universal,  shut- 
downs and  business  depressions  would  be 
avoided,  employment  would  be  regular,  the  an- 
nual increase  in  wealth  would  become  a  half 
more  or  double,  and  poverty,  hardship,  and  the 
crimes  which  grow  out  of  distressing  want, 
would  be  abolished.  This  would  be  the  natural 
outcome  of  that  equalization  of  demand  and 
supply  which  effects  the  consumption  of  all 
products  in  season  and  keeps  the  capacity  of 
production  constantly  and  steadily  at  the  maxi- 
mum. 

With  competition  general  and  unhindered, 
rivalry  would  be  moderate  and  friendly,  be- 
cause all  would  be  certain  of  marketing  their 
wares  in  season,  and  the  trend  would  be  to  pro- 
vide the  genuine  instead  of  the  spurious,  be- 
cause all  would  have  means  to  buy  the  best. 

Unrestricted  competition  would  enrich  reg- 


58        A  CURB  TO  PREDATORY  WEALTH. 

ularly  and  proportionately  both  capitalist  and 
laborer,  leaving  the  former  with  no  excess  with 
which  to  overbuild,  and  the  latter  with  no  lack 
of  means  with  which  to  supply  himself  with  all 
that  is  essential.  This  would  be  the  inevitable 
result  of  all  being  similarly  served  in  the  distri- 
bution of  profit  and  reward. 

These,  then,  would  be  the  industrial  results 
of  the  free  and  unrestricted  play  of  the  natural 
trade  law  handed  down  by  the  infallible  Author 
of  our  being  for  our  common  guidance  in  trade. 

How  vast  the  difference  between  this  salu- 
tary state  of  affairs  and  the  shocking  derange- 
ments produced  by  the  monopolistic  interfer- 
ence with  nature's  method! 

The  wheels  of  industry  shall  no  longer  be 
periodically  idle.  The  system  of  plunder  by 
special  privilege  shall  go.  The  acquisition  of 
stupendous  fortunes  by  a  favored  few  shall  be 
replaced  by  the  opportunity  for  all  to  earn  a 
competency.  No  longer  shall  the  whole  earth 
be  searched  to  find  a  market  for  our  surplus, 
but  ready  money  at  home  shall  permit  no  sur- 
plus. No  captain  of  industry  shall  seize  a  con- 
queror's share,  and  no  man  shall  be  so  plun- 
dered that  he  may  not  own  and  enjoy  his  own 
home.  The  day  of  the  monopolist  shall  pass 
and  the  morning  of  opportunity  shall  dawn. 


A  CURB  TO  PREDATORY  WEALTH.        59 

These  things  shall  come  to  pass  under  a  sys- 
tem of  free  competition. 

So  simple  an  expedient  as  lifting  the  heavy- 
end  of  taxation  from  the  weak  shoulders  of 
small  wealth  and  resting  it  on  the  stronger 
shoulders  of  large  wealth  will  inaugurate  this 
system  of  free  competition. 


CHAPTER  XI. 

FREEDOM    OF   COMPETITION   IS   ESSENTIAL  TO   THE 
PUBLIC  WELFARE. 

The  competition  which  the  decentralization  of 
the  huge  combines  would  put  into  free  play 
assures  the  desirable  results  pictured  in  the 
preceding  chapter.  Moreover,  the  inception  of 
these  results  is  impossible  unless  competition 
is  no  longer  hedged  about  by  the  unjust  re- 
strictions of  the  trusts,  because  of  the  com- 
plexities attending  the  problem  of  the  distribu- 
tion of  earnings. 

The  excellent  results  before  referred  to  are 
simply  the  fruits  of  an  arrangement  that  gives 
back  to  every  individual  the  precise  amount  of 
wealth  he  has  been  instrumental  in  bringing 
forth.  But  the  determination  of  the  amount 
or  the  value  of  what  one  has  created  and  of 
what  should  be  his  consequent  reward  is  com- 
plicated in  every  case  by  so  many  contingen- 
cies, possibilities,  and  hidden  eventualities  as 
to  place  the  problem  entirely  beyond  human 
60 


A  CURB  TO  PREDATORY  WEALTH.        61 

solution.  We  are  prevented  by  our  restrictive 
powers  from  discovering  what  is  the  real  value 
of  any  particular  commodity  brought  into  ex- 
istence by  a  unit  of  labor  or  capital  operating 
during  a  specific  period  of  time.  Unhampered 
nature  herself  is  the  only  agent  capable  of 
performing  this  intricate  task. 

Were  the  exploiting  monopolists,  for  any 
reason,  to  attempt  to  give  the  public  a  faultless 
distribution  of  earnings  they  could  only  fail 
in  their  endeavor.  For  such  is  the  limit  of 
man's  mental  powers  that  he  may  not  success- 
fully substitute  his  own  notions  for  the  resist- 
less workings  of  nature's  laws.  And  if  he  at- 
tempts such  substitution  he  denaturalizes  the 
normal  conditions  into  instruments  of  punish- 
ment for  himself  and  those  who  permit  the 
offending. 

How  perilous  it  is  to  proceed  at  cross  pur- 
pose with  nature  in  this  department  of  terres- 
trial activities  is  seen  by  reference  to  the  social 
afflictions  that  torture  us  upon  every  hand. 

Since  the  early  days  of  barter  and  trade  com- 
petition has  been  more  or  less  curtailed.  And 
co-extensive  with  this  curtailment  there  has 
been  profound  social  and  business  disturbance, 
distress  and  discontent. 

The  whole  history  of  business  argues  against 
the  suppression  of  business  rivalry  and  for  the 


62        A  CURB  TO  PREDATORY  WEALTH. 

contention  that  competition  is  a  natural  law  de- 
signed by  the  Creator  of  man  for  the  latter*s 
guidance  in  the  matter  of  profit  and  wages. 
It  supports  the  proposition  that  competition 
must  be  reinstated  fully  and  freely  if  we  are 
ever  to  have  wages  and  profits  adjusted  in  their 
proper  proportions,  and  to  the  ideal  of  general 
satisfaction  and  content. 

There  is  no  alternative  method  that  will 
serve.  Artificial  expedients  are  a  peril,  and  the 
greater  the  proportion  of  divergence  from  the 
natural  the  greater  the  degree  of  peril. 

The  profound  woes  with  which  the  race  is 
cursed  are  due  mainly  to  the  check  upon  the 
free  play  of  competition.  It  is  one  of  the  nat- 
ural provisions  that  cannot  be  infringed  upon 
with  impunity.  As  well  expect  to  plunge  head- 
long from  the  housetop  without  paying  for  the 
folly  in  broken  limbs  and  bruises,  as  to  hope 
to  violate  the  natural  law  of  trade  and  escape 
the  evil  consequences  of  so  doing. 

He  who  chokes  off  competition  between 
himself  and  the  masses  accumulates  unearned 
wealth,  cheats  his  fellow,  and  is  responsible 
for  poverty,  misery  and  crime.  He  narrows 
the  sphere  of  friendly  rivalry  and  finally  forces 
it  to  become  transformed  into  a  spirit  of  war- 
like strife  in  its  restricted  confines.  He  pre- 
vents that  fair  play  which  would  compensate 


A  CURB  TO  PREDATORY  WEALTH.        63 

each  one  according  to  his  deserts,  proportion 
production  to  consumption,  keep  the  wheels  of 
industry  in  a  constant  revolution,  and  make 
comfort  and  culture  the  ordinary  lot  of  all. 

The  restoration  of  competition  to  unrestrict- 
ed exercise  is  the  only  possible  method  of  ele- 
vating us  all  to  a  superior  standard  of  welfare. 

We  may  now  proceed  to  our  next  proposi- 
tion. As  it  is  evident  that  the  conditions  at- 
tending the  one-sided  competition  are  inex- 
pressibly bad,  for  both  classes  of  wealth,  the 
trustified  as  well  as  the  independent,  are  we 
not  warranted  in  setting  forth  the  proposition 
on  the  following  page  as  the  truth  ? 


PROPOSITION  THREE. 

The  submission  of  the  people  to  the  destruction 
of  competition  is  an  unwise  submission,  be- 
cause the  natural  law  of  competition  cannot  be 
safely  superceded  by  any  artificial  scheme. 


CHAPTER  XII. 

PREDATORY    METHODS    OF    GAINING    WEALTH. 

Powerful  oil  interests  conspire  with  the  rail- 
roads to  bankrupt  competitors  by  systems  of 
freight  rebates  that  enable  the  conspirators  to 
undersell  all  others  in  the  markets.  What  they 
fail  to  accomplish  in  this  way  they  secure  by 
gobbling  up  rival  pipe  lines.  Having  killed 
competition,  the  conspirators  proceed  to  boost 
the  price  of  a  natural  commodity  that  seemed 
designed  to  be  next  to  water  in  cheapness  by 
entering  upon  a  career  of  over-charging  and 
plundering  that  elevates  them  to  chieftancy 
among  the  world's  money  kings  within  the 
space  of  half  a  generation  of  time. 

Lordly  meat-packing  interests  combine  to 
exact  unwarranted  profits  by  cornering  the 
business  of  packing  and  shipping  cattle  and 
pork  in  the  West,  and  then  dictating  prices 
both  to  the  shipper  of  the  live  animal  and  to 
the  consumer  of  the  dressed  product.  The 
effect  is  to  drive  the  normally  profitable  busi- 
ness of  stock-feeding  into  rapid  decline  and 
67 


68        A  CURB  TO  PREDATORY  WEALTH. 

loss,  to  bankrupt  thousands  of  farmers,  to  ren- 
der the  prices  of  meat  almost  prohibitive  for 
the  consumer  and  at  the  same  time  make  multi- 
millionaires of  the  members  of  the  meat-pack- 
ing clique. 

Greedy  railroad  magnates,  intriguing  against 
the  people,  capitalize  railroads  on  a  fictitious 
valuation  in  order  that  large  sums  may  be  real- 
ized on  the  sale  of  the  stock  and  borrowed  on 
bond  issues.  Until  all  these  securities  can  be 
unloaded  upon  a  confiding  public,  dividends  and 
interest  are  paid  upon  them  by  diverting  the 
money  away  from  repairs  and  letting  the  road 
run  down.  By  the  time  the  lambs  have  been 
cajoled  into  purchasing  the  securities  the  road 
is  such  a  debt-burdened  scrapheap  that  by  no 
stretch  of  imagination  can  it  be  considered  a 
possible  dividend  payer.  The  claims  of  the 
stockholders  are  then  forgotten  and  the  earn- 
ings applied  to  reviving  the  working  condition 
of  the  road,  a  proceeding  that  serves  the  double 
purpose  of  upbuilding  the  road  for  the  con- 
spirators and  enabling  them  to  repurchase  the 
stocks  at  a  sacrifice,  with  which  to  repeat  the 
process  of  fooling  the  lambs.  Eventually  the 
railroads  of  the  nation  are  theirs.  Coupled 
with  this  perfidious  deception  and  robbery  is 
a  system  of  freight  and  passenger  rates  as  ex- 
tortionate as  the  traffic  will  bear. 


A  CURB  TO  PREDATORY  WEALTH.        69 

Great  jugglers  of  finance  and  their  agents 
conspire  to  subject  the  entire  populace  to  a 
state  of  interest-paying  dependence.  The  earth 
is  their  field,  bond  shaving  their  profession,  and 
the  use  of  bribery  and  corruption  for  the  effect- 
ing of  unholy  and  one-sided  bargains  their 
common  practice.  The  national  bonded  debt 
for  carrying  on  the  Civil  War  could  have  been 
avoided  or  kept  vastly  smaller  but  for  their 
corrupting  interference.  These  debt-manipu- 
lating sharks  would  make  the  peoples  of  every 
clime  tax  themselves  twice,  once  to  support 
their  own  governments,  and  again  to  pay  in- 
terest to  the  sharks.  And  they  would  subject 
every  industry  to  the  same  necessity,  by  com- 
pelling it  to  earn  a  revenue  for  them  in  addi- 
tion to  that  which  it  must  have  for  itself.  And 
so  insistent  are  they  for  their  pounds  of  flesh 
that  they  will  view  with  serenity  the  beggaring 
to  their  graves  of  thousands  of  Hindu  subjects, 
the  murder  of  a  race  of  Armenian  citizens,  or 
the  wholesale  starvation  of  a  whole  population 
of  hapless  reconcentrados  before  they  will  con- 
sent of  their  own  accord  to  a  dollar's  deprecia- 
tion in  the  value  of  their  bonded  obligations  or 
to  the  default  of  a  cent  in  the  amount  of  the 
interest. 

The  foregoing  are  but  illustrations  of  the 
methods  of  the  spoliators  engaged  in  perpetual 


70        A  CURB  TO  PREDATORY  WEALTH. 

schemes  of  deception  and  plunder.  Telegraph 
and  telephone  trusts,  street-car  and  electric 
light  monopolies,  corners  in  the  cereals  of  the 
farm,  hundreds  of  combines,  and  speculations 
in  scores  of  products  and  in  all  classes  of  se- 
curities, go  to  complete  a  list  of  offences  which 
make  this  age  notorious  for  its  industrial  ex- 
ploitation and  financial  trickery. 

Bereft  of  all  business  honor,  and  thoroughly 
oblivious  to  the  rights  of  the  people,  these  cor- 
morants know  no  creed  but  selfishness  and  are 
moved  by  no  impulse  but  that  of  gain.  Blind- 
ed by  their  cupidity  they  cannot  be  convinced 
of  impending  dangers,  and  hardened  by  the 
incidents  of  their  despotism  they  cannot  be 
moved  in  their  sensibilities.  So  they  go  head- 
long, threatening  the  destruction  of  our  insti- 
tutions and  the  undermining  of  their  own  sup- 
port by  plunging  the  people  into  a  state  of 
poverty  and  inability  to  buy.  Gouging  and 
plundering,  bribing  and  coercing,  corrupting 
and  oppressing  as  they  do,  these  devotees  of 
the  Religion  of  Greed  are  in  the  eyes  of  the 
moral  law,  if  not  the  criminal  law,  villians  a 
hundred  fold  more  perfidious  and  deserving  of 
punishment  than  the  most  bloodthirsty  an- 
archists and  bomb  throwers. 

Yet  these  are  the  people  that  dictate  the  legis- 
lative, executive  and  judicial  policy  of  govern- 


A  CURB  TO  PREDATORY  WEALTH.        71 

ments! — that  would  have  every  important  af- 
fair of  state  shaped  in  harmony  w^ith,  or  sub- 
ordinated to,  their  individual  interests  and 
designs ! 


CHAPTER  XIII. 

ss  folly"  and  the  cost  of  it. 

The  exploitation  of  the  people  by  the  "Inter- 
ests" is  what  may  be  termed  "Big  Business 
Folly,"  for  it  consigns  a  large  percentage  of  the 
wealth  of  the  nation  to  a  state  of  inaction. 
The  wealth  which  is  gouged  by  the  trusts  from 
the  people's  just  share  of  earnings  invariably 
subsides  into  disuse.  It  can  no  longer  be  of 
service  to  the  victims  of  the  gouging  because 
it  composed  a  portion  of  their  means  of  pur- 
chase ani  the  theft  of  it  leaves  them  weakened 
to  that  extent  in  their  purchasing  power. 

In  the  possession  of  the  exploiters  this  booty- 
becomes  equally  unserviceable  as  a  means  of 
human  aid,  but  owing  to  a  different  reason.  It 
fails  to  be  of  any  practical  use  to  the  plunderers 
because  their  business  and  personal  needs  were 
already  amply  met  by  that  proportion  of  profit 
on  their  investment  which  constitutes  a  "square 
deal."  It  is  a  useless  superfluity  in  their  hands, 
made  so  by  that  plundering  process  which 
72 


A  CURB  TO  PREDATORY  WEALTH.        73 

leaves  the  people  without  any  foil  for  it  in  the 
give  and  take  of  trade. 

Of  course  the  interests  do  not  subscribe 
to  this  theory.  They  believe  that  in  plucking 
the  people  they  are  setting  themselves  just  as 
much  ahead  in  the  contest  of  wealth-getting. 
So  they  go  on  and  employ  their  "velvet"  in 
the  search  for  a  still  greater  degree  of  profit — 
and  graft. 

Some  of  this  stolen  wealth  is  invested  by 
them  in  enlarging  their  mining,  factory,  and 
other  operations.  But  that  only  adds  to  the 
discrepancy  between  their  capacity  to  supply  and 
the  ability  of  the  plundered  people  to  buy. 

A  favorite  scheme  of  Big  Business  is  to  seek 
a  foreign  market  for  their  stolen  surpluses. 
But  the  commodities  taken  in  exchange  are  still 
beyond  the  reach  of  the  plundered  people. 

In  other  ways  the  portion  stolen  from  the 
people  is  caused  to  play  its  devious  part  in  the 
pursuit  of  additional  gain  for  its  masters.  But 
at  no  time  does  it  take  a  natural  place  in  the 
economy  of  trade.  Always  constituting,  in  the 
hands  of  the  looters,  a  superfluity  over  that 
which  is  essential  to  their  capitalistic  needs, 
the  tribute  remains  without  the  pale  of  utility, 
unused  in  the  normal  process  of  creating 
wealth. 


74        A  CURB  TO  PREDATORY  WEALTH. 

What  does  this  folly  cost  us  in  the  way  of 
discomforts? 

The  instant  cost  is  to  be  found  in  the  re- 
trenchment imposed  as  a  necessity — the  oblig- 
ing the  victims  of  the  plunder  to  live  on  a 
lower  plane  with  less  of  the  good  things  of  life 
than  would  have  fallen  to  their  lot  had  they 
not  been  robbed  of  a  share  of  their  earnings. 

But  this  is  not  the  sole  nor  the  chief  cost,  as 
the  worst  is  an  after-effect.  To  keep  the  wheels 
of  industry  constantly  in  motion,  with  result- 
ing well  doing  to  the  people,  the  producers  of 
the  means  of  subsistence  must  be  continually 
clearing  the  way  for  new  supply  of  commodi- 
ties by  purchasing  them  as  fast  as  they  create 
them.  This  they  cannot  possibly  do  if  the 
compensation  of  the  great  mass  of  the  consum- 
ers falls  below  their  earnings.  Consequently 
the  stolen  share,  except  such  part  of  it  as  is 
wasted  in  riotous  living  and  extravagances  by 
the  looters,  is  bound  to  appear  in  the  channels 
of  trade  in  "overproduction."  Thus  it  be- 
comes the  common  cause  of  business  depres- 
sion, closure  of  industries,  lack  of  work,  and 
their  attendants,  poverty,  wretchedness  and 
crime.  Add  this  result  to  the  self-denial  the 
plundering  first  necessitates,  and  one  has  an 
idea  of  the  tremendous  price  we  pay  for  the 


A  CURB  TO  PREDATORY  WEALTH.        75 

folly  of  having  a  portion  of  the  people's  earn- 
ings greedily  shelved,  during  the  course  of  pro- 
duction and  trade,  into  a  state  of  unavailability 
for  common  use. 


CHAPTER  XIV. 

THE  "big  stick"  OF  "bIG  BUSINESS." 

Financial  panic  is  a  club  that  is  swung  by  the 
Interests  to  intimidate  the  people  and  prevent 
them  from  making  laws  that  will  interfere  with 
their  schemes  and  exploitation. 

The  plying  of  this  bludgeon  is  so  disastrous 
to  ordinary  business  and  wage  earners  that  the 
people  are  extremely  loth  to  make  or  enforce 
laws  that  will  provoke  its  blows. 

But,  under  the  operation  of  a  tax  graduated 
to  bear  more  heavily  upon  large  than  small 
wealth,  the  trick  of  panic-making  could  be  easi- 
ly prevented  by  providing,  through  appropri- 
ate legislation,  those  who  were  thrown  out 
of  employment  with  public  work,  such  as  road 
building,  improving  waterways,  and  so  forth. 
As  the  greater  part  of  the  cost  of  the  tax  ex- 
pense for  this  work  would  be  borne  by  the 
Interests,  on  account  of  their  heavier  rate  of 
taxation,  the  effect  of  the  graduated  tax  would 
be  to  discourage  them  from  using  this  "big 
70 


A  CURB  TO  PREDATORY  WEALTH.        77 

stick."  In  other  words,  the  adoption  of  an  em- 
ployment measure  in  connection  with  a  gradu- 
ated tax  would  put  such  a  club  practically  out 
of  commission.  The  Interests  would  not  in- 
vite upon  themselves  the  extra  taxation  which 
would  follow  their  engaging  in  such  coercion. 

An  employment  measure  as  a  check  to  ma- 
chine-made panics  would  be  a  peculiarly  ap- 
propriate one  because  it  is  a  policy  defensively 
strong  on  general  principles.  Public  work  for 
the  indigent  unemployed  is  a  measure  that  is 
needed  under  any  condition.  Organized  so- 
ciety is  under  a  moral  obligation  to  give  work 
to  the  man  who  needs  it,  and  the  fact  that  this 
has  not  been  done  is  simply  a  proof  that  so- 
ciety has  not  been  doing  its  duty.  The  very 
existence  of  men  in  idleness  and  distress,  in  a 
country  with  resources  sufficient  for  all  de- 
mands, is  evidence  that  there  is  a  defect  some- 
where in  the  social  organization. 

In  many  of  the  channels  of  industry  there  is 
an  unfair  distribution  of  earnings.  The  grad- 
uated taxer  says  that  the  cause  of  this  is  the 
neglect  of  society  to  protect  itself  from  the 
throttling  of  competition.  Whatever  be  the 
cause,  the  omission  to  so  provide  that  all  may 
earn  sufficient  to  live  in  comfort  is  a  defect 
for  which  society  should  make  amends  by  fur- 
nishing, as  above  suggested,  public  employ- 


78        A  CURB  TO  PREDATORY  WEALTH. 

ment  to  those  that  have  become  the  helpless 
victims  of  such  neglect. 

The  same  motives  that  exist  for  caring  for 
the  aged  and  decrepid,  and  for  restraining  the 
criminal  and  vicious,  exist  for  giving  employ- 
ment and  remuneration  to  the  hungry  and 
needy.  Why  wait  until  a  man  is  broken  down 
in  health  and  has  been  driven  to  the  verge  of 
inveterate  pauperism  before  administering  aid? 
Why  deprive  society  of  his  usefulness  as  a 
wealth-creator  by  forcing  him  to  remain  in 
idleness? 

The  policy  of  giving  employment  would  en- 
rich us,  while  the  support  of  men  in  idleness 
by  charity  represents  a  distinct  loss.  We  would 
save  also  on  the  maintenance  of  county  homes 
and  hospitals,  and  on  criminal  courts  and  jails. 
Better  yet,  this  policy  would  give  comfort  in 
the  ranks  of  the  wage  earners  that  would  re- 
place hunger  and  wretchedness.  It  would  give 
trade  to  our  merchants  instead  of  business  de- 
pression and  bankruptcy.  It  would  give  us 
something  in  value  in  return  for  our  taxes, 
whereas  mere  charity  and  the  punishment  of 
criminals  does  not. 

It  it  be  urged  that  the  proposal  to  give  pub- 
lic employment  to  the  enforcedly  idle  is  social- 
istic, then  it  must  be  held  that  repairing  of  our 
township  roads  and  borough  streets,  building 


A  CURB  TO  PREDATORY  WEALTH.        79 

our  canals,  maintaining  the  postoffice,  and 
training  our  children  in  the  public  schools,  and 
the  administration  of  our  laws  and  courts  of 
justice,  are  socialistic,  for  these  could  all  be 
performed  by  private  enterprise. 

Such  are  the  justifications  that  may  be  ad- 
vanced in  behalf  of  a  public  employment  meas- 
ure considered  alone.  It  is  a  means  that  would 
work  benefits  very  similar  to  those  sought 
through  the  graduated  tax  and  on  that  account 
is  peculiarly  suited  to  be  coupled  with  the  tax 
as  a  means  of  human  uplift.  As  a  corollary  to 
the  graduated  tax  it  would,  by  putting  the  bur- 
den of  public  employment  on  large  wealth, 
move  the  Interests  to  renounce  all  idea  of  re- 
sorting to  the  use  of  the  panic  club. 

A  summary  of  this  section  of  our  treatise 
may  be  stated  as  in  proposition  Four. 


PROPOSITION  FOUR. 

The  submission  of  the  people  to  trust  methods  is 
a  thoroughly  mistaken  submission,  because  the 
trust  system  works  against  and  not  for  the 
best  industrial  progress. 


CHAPTER  XV. 

SOME    MISCONCEPTIONS  OF   ECONOMIC  QUESTIONS. 

Accepting  the  conclusion  that  the  arbitrary 
determination  and  maintenance  of  prices  by 
the  monopolies  is  followed  by  evil  effects  upon 
the  social  organization,  how  are  we  to  account 
for  their  persistence  as  an  element  of  our  in- 
dustrial system. 

Here,  as  in  the  consideration  of  all  problems 
of  life,  we  must  make  due  allowance  for  the 
fallibility  of  the  mind.  We  are  apt  to  err  both 
as  to  what  are  the  real  advantages  in  life  and 
as  to  the  best  method  of  obtaining  those  ad- 
vantages. 

Concerning  the  topic  under  discussion,  here 
we  find  an  individual  who  believes  that  the 
concentration  of  capital  in  the  hands  of  a  few 
leaders,  with  the  mass  of  the  people  existing  in 
a  state  of  dependency  upon  those  leaders,  is 
the  best  form  organized  society  can  assume. 
A  person  holding  such  views  is,  of  course,  will- 
ing that  one  small  class  of  society  should  com- 
83 


84       A  CURB  TO  PREDATORY  WEALTH. 

pel  another,  though  larger,  class  of  society  to 
pay  tribute  to  it.  l 

This  person's  neighbor  may  be  alive  to  the 
injustice  of  this  extortion  and  yet  honestly  be- 
lieve that  the  concentration  of  capital  is  in- 
evitable and  necessary,  and  that  the  evils  re- 
sulting from  such  a  system,  however  much  to 
be  deplored,  must  be  borne.  He  is  disposed  to 
make  the  best  of  such  conditions  because  he 
imagines  it  to  be  a  hopeless  task  to  try  for 
aught  else. 

Some  decline  to  concede  innate  equality  of 
rights  to  all  and  maintain  that  a  select  class 
is  entitled  to  the  luxuries  of  the  earth,  and  that 
the  common  people  have  their  deserts  when 
they  are  left  an  ordinary  subsistence. 

Others,  believing  in  the  theoretical  equality 
of  rights,  deny  that  the  evils  of  society  are 
caused  by  the  exactions  of  man  from  man,  and 
assert  that  they  have  their  origin  elsewhere. 
Such  as  they  do  not  denounce  exaction  because 
it  does  not  appear  to  them  to  be  the  chief  evil 
of  the  times. 

The  avaricious  individual  who  accumulates 
millions  by  plundering  a  nation  does  not  realize 
that  he  is  undermining  the  foundation  upon 
which  the  well-doing  of  all  wealth  depends. 
He  favors  exaction,  although  he  does  not  call 
it  that,  because  he  fondly  imagines  that  he  is 


A  CURB  TO  PREDATORY  WEALTH.        85 

thus  laying  the  foundation  for  his  own  wel- 
fare and  that  of  his  heirs  to  follow. 

Finally,  there  may  be  some  who  comprehend 
what  is  best  for  our  welfare  and  the  actual 
cause  of  our  oppressed  condition  and  yet  be 
unable  to  see  the  way  to  the  promotion  of  the 
one  or  the  extinction  of  the  other. 

Such  opinions,  or  lack  of  opinions  account, 
we  believe,  for  much  of  the  indifference  felt  in 
regard  to  the  need  of  social  advancement,  and 
for  the  usual  tame  submission  to  the  predatory 
exploiters. 


CHAPTER  XVI. 

THE  FALLACY  OF  ALTRUISM. 

But,  though  man  may  err  in  his  methods  of 
attaining  the  siimmiim  honum,  why,  let  us  in- 
quire, is  he  wilHng  to  profit  at  the  expense  of 
fellow  beings  whose  rights  he  ought  to  respect 
as  human  beings  like  himself? 

We  have  only  to  remember  that  the  principle 
of  self-preservation,  otherwise  self-love  or  self- 
interest,  is  deeply  rooted  in  men,  ever  leading 
them,  with  more  or  less  diligence  and  variety 
of  method,  to  give  preference  to  themselves  in 
the  struggle  for  benefits.  This  self-love  (which 
must  not  be  confounded  with  selfishness),  con- 
sidered simply  from  the  standpoint  of  primi- 
tive human  nature,  is  stronger  than  love  for 
any  external  person  or  thing. 

We  are  not  to  suppose  that  men  generally 
delight  in  causing  human  distress  by  encroach- 
ing upon  others'  rights,  for,  at  least  before  the 
heart  becomes  hardened,  inborn  human  sym- 


A  CURB  TO  PREDATORY  WEALTH.        87 

pathy  tends  to  restrain  one  from  injury  to  his 
fellows. 

But  we  are  to  suppose  that  man  encroaches, 
when  maladjustments  in  social  conditions  in- 
vite the  evil,  because,  while  he  may  like  to 
avoid  distressing  his  fellow  he  likes  still  more 
to  satisfy  himself. 

Let  us  now  look  into  the  nature  of  some  of 
the  remedies  for  encroachment. 

Some  will  say,  ^'educate  self-interest  into  the 
background."  They  believe  that  if  self-interest 
could  be  made  to  yield  to  the  power  of  sym- 
pathy, charity,  or  the  altruistic  principle  that 
men  should  regard  the  welfare  of  others  above 
their  own,  the  happiness  of  the  millenium 
would  be  ours.  But  those  who  hold  this  view, 
it  is  respectfully  contended,  labor  under  de- 
lusion. 

For  what  would  be  the  consequence  to  the 
human  race  if  man's  nature  were  suddenly 
transformed  so  that  self-interest  stood  subor- 
dinated as  a  spring  of  action,  and  concern  for 
the  welfare  of  things  other  than  self  became 
the  ruling  stimulus?  There  would  follow  the 
speedy  extinction  of  the  human  race.  Because, 
if  a  man  loved  to  have  all  other  things  pre- 
served as  they  are  rather  than  himself  pre- 
served as  he  is,  he  would  suffer  himself  to 
perish  of  want  before  he  would  molest  them 


88        A  CURB  TO  PREDATORY  WEALTH. 

for  the  procuring  of  nutriment.  Since  he  would 
not  perform  the  important  function  of  perpetu- 
ating himself,  much  less  would  he  be  likely  to 
look  after  his  own  welfare  and  progress. 

Then,  suppose  the  self-interest  of  man  were 
inferior  only  to  his  regard  for  his  fellowman, 
but  holding  the  usual  sway  over  his  attitude 
toward  the  lower  orders  of  things.  He  would 
be  but  little  better  off.  For  if  his  regard  for  his 
fellowmen  were  his  greatest  concern,  he  would 
spend  his  time  needlessly  proffering  his  aid  to 
others,  only  to  find  them  similarly  engaged 
in  a  fruitless  endeavor  to  aid  him.  Under  such 
conditions  the  world  would  be  overgrown  with 
weeds  and  tares  and  nothing  would  be  brought 
forth  to  prevent  man  from  starving  off  the 
face  of  the  earth.  Even  if  man's  love  for  others 
were  just  equal  to  his  love  for  self,  it  would 
avail  him  nothing,  for  his  arms  would  be  para- 
lyzed by  his  inability  to  choose  whom  to  serve, 
himself  or  his  neighbor.  Prospects  such  as 
these  confront  us  when  we  think  of  placing 
self-interest  in  the  background,  supposing  it 
could  be  done,  and  attest  the  futility  of  look- 
ing for  relief  in  this  direction. 

The  predominance  of  self-interest  is  for  a 
wise  purpose.  Since  self-interest  is  supreme, 
the  emotions  of  pity  and  tenderness  cannot  stay 
man    from    slaughtering    the    lower    animals 


A  CURB  TO  PREDATORY  WEALTH.        89 

needed  for  food.  Likewise,  all  question  as  to 
whom  chief  aid  should  be  given  is  at  once  an- 
swered by  the  innate  demand  that  each  one  be 
the  principal  beneficiary  of  his  own  acts. 

It  is  the  plan  the  Creator  has  adopted  to 
have  us  accomplish  what  we  were  born  to  do. 
He  moves  us  to  the  fulfillment  of  our  mission 
by  causing  each  to  attend  primarily  to  his 
own  welfare,  designing  the  independent  well- 
being  of  the  unit  in  order  to  accomplish  the 
collective  well-being  of  the  whole. 

We  see,  then,  that  the  preponderance  of  self- 
interest  in  us  is  an  indispensable  provision  for 
our  safety,  though  it  does  lead  one,  when  the 
conditions  are  false,  into  profiting  at  the  ex- 
pense of  his  fellow. 


CHAPTER  XVII. 

REGULATING   TRUSTS   BY    FINES   AND   IMPRISON- 
MENT. 

Let  us  look  into  the  plan  of  preventing  the  en- 
croachment of  vast  combinations  of  wealth 
upon  the  rights  of  the  people  that  is  com- 
prehended in  the  usual  fine  and  imprisonment 
codes. 

Prevention  by  this  method  is  to  be  con- 
demned, in  the  first  place,  because  the  remedy 
is  one  calculated  to  shape  itself  into  an  in- 
strument of  oppression.  That  is,  the  result 
which  would  be  carried  into  execution  in  the 
event  of  successful  enforcement  would  consist 
less  in  preventing  of  extortion  on  the  part  of 
the  predatory  class  than  in  turning  the  tables 
and  exercising  extortion  upon  them. 

Some  may  be  inclined  to  differ  here  and 
contend  that  the  people  at  large  would  stop 
at  a  just  and  reasonable  limit  in  their  demands 
upon  their  former  exploiters.  But  partisans 
of  this  view  have  not  stopped  to  analyze  closely 
90 


A  CURB  TO  PREDATORY  WEALTH.        91 

the  character  of  human  inclinations.  If  we 
could,  by  the  scheme  of  fine  and  imprisonment, 
enforce  obedience  to  our  likes  in  the  distribu- 
tion of  earnings,  would  we  stop  short  of  profit- 
ing to  the  same  degree  from  monopolists  as 
they  now  are  from  us?  Our  appreciation  of 
the  nature  and  force  of  self-interest  precludes 
any  such  conclusion. 

Inasmuch,  therefore,  as  the  object  to  be  at- 
tained is  not  to  transfer  from  one  to  another 
the  opportunity  for  extortion,  but  to  banish 
entirely  from  society  an  evil  monstrous  in  it- 
self and  in  the  consequences  it  entails,  the  im- 
postion  of  fine  and  imprisonment  penalties 
should  be  condemned  as  altogether  undesirable 
by  those  who  cherish  the  welfare  of  the  people. 

The  method  of  fine  and  imprisonment  should 
be  objected  to,  in  the  second  place,  because  it 
is  a  ludicrously  impracticable  scheme.  How 
hopelessly  impotent  it  is,  we  see  when  we  re- 
member the  utter  futility  attending  our  at- 
tempts to  curb  the  trusts  and  illegal  combina- 
tions. 

What  is  the  outcome  of  so  much  wasted 
effort?  For  ourselves,  a  continuous  endeavor 
to  keep  large  capital  within  the  bounds  we  may 
deem  proper;  for  the  exploiters,  a  cynical  dis- 
regard of  our  attempted  restraints  and  the  free 
use  of  the  opportunity  left  open  to  them  to 


92        A  CURB  TO  PREDATORY  WEALTH. 

effect  combinations  through  which  to  dictate 
prices. 

Our  penal  codes  for  the  curbing  of  monopoly 
have  always  been  the  deadest  of  dead  letters. 
Where  is  the  law  for  regulating  the  manage- 
ment of  the  railroads,  for  fixing  wage  scedules, 
or  for  controlling  predatory  combinations  in 
any  way  that  has  been  of  appreciable  good? 
It  is  not  on  the  list  of  distinguished  suc- 
cesses. 

Why  this  mode  of  prevention  should  prove 
itself  to  be  an  outright  failure,  there  is  abund- 
ant reason.  In  its  adoption  and  employment 
we  have  put  ourselves  in  direct  antagonism  to, 
instead  of  working  harmony  with,  the  uncon- 
querable spirit  of  self-interest.  We  are  en- 
deavoring to  make  men  forego  the  use  of  the 
greater  opportunity  for  the  accumulating  of 
gain  and  at  the  same  time  we  have  failed  to 
shape  that  opportunity  so  that  the  better 
chance  for  profiting  lies  in  staying  out  of,  in- 
stead of  going  into,  the  trusts  and  combina- 
tions. 

Self-interest  is  indomitable;  fine  and  im- 
prisonment laws  are  worthless ;  we  are  helpless 
before  our  aggressors.  On  the  other  hand, 
could  we  achieve  our  ambition  to  bring  our 
exploiters  into  subjection,  we  would  be  unable 
to  avoid  becoming  aggressors  ourselves.    This 


A  CURB  TO  PREDATORY  WEALTH.        93 

is  the  situation  as  seen  in  the  light  of  the  facts. 

Is  there,  then,  no  remedy?  Which  way  shall 
we  turn  for  relief? 

This  way:  Recognize  that  self-interest  pre- 
dominates in  man  and  that  this  attribute  dis- 
poses him  steadily  and  sternly  to  seek  the 
greatest  possible  profit  for  himself.  Recognize 
that  it  is  neither  desirable  to  dissuade  men 
from  endeavoring  to  gain  the  greatest  profit 
nor  possible  to  prevent  their  so  doing.  Then 
shall  we  perceive  that  in  planning  anti-trust 
legislation  it  is  essential  to  take  the  principle 
of  self-interest  into  consideration,  and  that  we 
can  achieve  success  only  by  framing  a  law  in 
such  a  way  that  it  will  bring  about  the  co- 
operation instead  of  the  antagonism  of  the 
great  capitalists. 

When  we  shall  have  fully  realized  this,  we 
shall  be  able  to  see  how  practical  a  remedy  the 
graduated  property  tax  is,  for  it,  alone  of  all 
measures  that  have  ever  been  devised,  would 
cause  combinations  of  capital  to  separate  into 
independent  enterprises  voluntarily. 

The  conclusion  is  succintly  stated  in  propo- 
sition Five. 


PROPOSITION  FIVE. 

The  attempt  to  curb  the  trusts  by  fine  and  int^ 
prisonment  laws  is  a  useless  attempt,  because  it 
completely  ignores  a  fundamental  principle  of 
human  conduct — self-interest. 


CHAPTER  XVIIL 

THE    GRADUATED   TAX    VERSUS    THE    INCOME   TAX 
AND  THE  INHERITANCE  TAX. 

The  attention  of  the  advocates  of  the  income 
tax  is  called  to  the  graduated  property  tax  as 
a  scheme  which  fulfills  the  purpose  of  the 
former,  yet  possesses  several  advantages  not 
provided  by  an  income  tax. 

The  income  plan,  in  a  measure,  conforms  to 
the  principle  that  the  taxes  should  be  imposed 
in  proportion  to  the  ability  to  pay.  So  does 
the  graduated  property  plan. 

Thus  far  the  two  systems  are  similar,  but 
beyond  this  they  differ,  to  the  discredit  of  the 
income  method  and  the  credit  of  the  graduated 
method. 

The  income  tax  will  not  prevent  the  undue 
concentration  of  wealth.  Even  if  the  "Captains 
of  Industry"  were  compelled  to  give  up,  in  the 
form  of  an  income  tax,  a  little  larger  share  of 
their  extraordinary  profits,  this  would  not  pre- 
vent them  from  forming  their  combinations. 
97 


98        A  CURB  TO  PREDATORY  WEALTH. 

And  as  long  as  they  can  do  that,  they  can 
recover  what  they  lose  in  taxes  by  twisting 
the  screws  a  little  tighter  at  one  point  to  make 
up  for  what  they  must  yield  at  another. 

The  graduated  property  tax  does  not  permit 
them  to  recoup  in  this  way,  for  its  special  func- 
tion is  to  prohibit  monopolistic  conbinations, 
and  if  the  capitalists  cannot  form  these  com- 
binations, they  will  be  without  the  machinery 
for  recovering  the  extra  money  they  will,  under 
the  proposed  system,  be  obliged  to  pay. 

The  prying  into  private  affairs  that  would 
inevitably  accompany  the  assessment  of  an 
income  tax  would  render  it  very  obnoxious. 
In  all  probability  it  would  be  repealed  for  that 
reason. 

No  unusual  prying  would  be  required  in 
assessing  the  graduated  property  tax,  because 
it  would  be  levied  in  the  same  manner  as  the 
taxes  now  are,  upon  the  lands,  mines,  manu- 
factories, stores,  and  other  plainly  visible  ob- 
jects, the  values  of  which  can  be  ascertained 
without  prying  into  the  peculiarly  private  af- 
fairs of  individuals. 

Those  who  honestly  reported  their  incomes 
for  taxation  would  be  brought  into  unfair  com- 
petition with  the  dishonest  who  might  resort 
to  concealment,  lying  and  perjury  to  avoid  di- 
vulging what  their  real  incomes  were. 


A  CURB  TO  PREDATORY  WEALTH.        99 

There  could  be  little  opportunity  for  mis- 
representation and  evasion  in  the  case  of  the 
graduated  property  tax,  for  it  has  to  deal,  like 
our  present  direct  system,  with  visible  proper- 
ties themselves  instead  of  with  the  invisible 
profits  of  properties. 

Then  why  not  abandon  the  income  plan  for 
this  more  improved  method  of  levying  the 
taxes  in  proportion  to  the  ability  to  pay?  Why 
not  seek  a  method  that  will  right  the  present 
disordered  state  of  society? 

THE  INHERITANCE  TAX. 

An  inheritance  tax  upon  large  wealth  has 
been  proposed  as  a  means  of  relieving  the 
poorer  classes  of  some  of  the  burden  of  taxa- 
tion and  placing  it  upon  those  better  able  to 
bear  it. 

But  when  it  is  recognized  that  those  to 
whom  the  inheritance  tax  would  apply,  in  the 
vast  majority  of  instances,  indirectly  obtained 
their  wealth  through  exploitation  of  the  poorer 
classes,  the  position  assumed  is  practically  that 
of  condoning  an  evil  for  pay. 

Why  not  prevent  the  damage  rather  than 
first  permit  it  and  then  look  to  be  recompensed 
in  a  paltry  sum  afterward?    Why  not  abolish 


100      A  CURB  TO  PREDATORY  WEALTH. 

the  business  of  crushing  rivals  in  business  by 
any  one  man  or  set  of  men,  through  means  of 
the  graduated  property  tax  which  induces  com- 
petition and  legitimate  business  methods? 


CHAPTER  XIX. 

THE  GRADUATED  TAX  AND  THE  SINGLE  TAX. 

In  principle  the  single  tax  and  the  graduated 
property  tax  are  the  same;  both  are  intended 
to  prevent  monopoly  by  so  discriminating 
against  it  by  an  increase  in  the  tax  rate  as  to 
render  it  unprofitable  to  monopolize.  They 
differ  only  in  method  of  application,  which  is 
of  no  more  importance  than  the  difference 
between  the  various  sects  of  protectionists, 
banking  system  champions,  or  advocates  of 
government  ownership,  for  in  these  theories 
founded  on  similar  principles  the  differences 
in  detail  may  be  numerous  but  are  largely 
neglible. 

The  single  taxer  would  tax  the  land  only. 

The  graduated  taxer  would  tax  all  property 
used  or  usable  as  a  basis  of  profit,  such  as  the 
land,  barn,  machinery,  and  work  animals  of 
the  farmer;  the  plant,  including  land,  build- 
ings, machinery,  and  average  supply  of  work- 
ing stock,  of  the  manufacturer;  the  goods  and 
101 


102     A  CURB  TO  PREDATORY  WEALTH. 

storehouse  of  the  merchant;  the  office  build- 
ing, cash,  and  notes  of  the  money  lender. 

The  single  taxer  would  exempt  from  levy 
every  form  of  property,  whether  used  as  a 
means  of  profit  or  not,  except  land. 

The  progressive  taxer  would  create  a  large 
exemption  list,  but  would  not  go  as  far  as 
the  single  taxer.  He  would  exempt,  first,  all 
production  and  profits,  such  as  the  grain  or 
live  stock  raised  for  the  market  by  the  farmer, 
the  output  of  the  manufacturer,  the  profit  on 
the  merchant's  sales,  and  the  interest  of  the 
money  lender ;  secondly,  all  property  or  effects 
applied  to  sustenance,  comfort  and  pleasure, 
such  as  the  residence  and  furnishings  of  the 
home,  the  driving  horse  and  carriage,  the  auto- 
mobile, pleasure  yacht  and  aeroplane. 

In  a  nutshell,  the  single  taxer  would  protect 
from  a  particular  form  of  exploitation;  the 
graduated  taxer  would  protect  from  that  and 
all  other  forms. 

The  single  taxer  holds  that  the  destruction 
of  land  monopoly  alone  is  sufficient  to  liberate 
the  people  from  oppression,  because  it  would 
allow  them  to  make  themselves  independent 
of  exploiters  and  taskmasters  by  settling  upon 
cheap  land  and  earning  their  living  from  it. 

The  graduated  taxer  takes  issue  here  and 
maintains  that  if  manufacturing,  mining,  mer- 


A  CURB  TO  PREDATORY  WEALTH.      103 

cantile  and  other  combines  are  allowed  to  exist 
they  will  continue  their  present  system  of  ex- 
ploitation so  that  the  man  who  goes  into  the 
country  to  earn  a  livelihood  will  find  his  con- 
dition unimproved,  and  will  eventually  be 
starved  into  abandoning  his  farm.  At  the  pres- 
ent time  farmers  are  often  compelled  to  do  this 
because  the  trusts  control  the  prices  both  of 
what  the  farmer  sells  and  what  he  must  buy 
in  order  to  pursue  his  vocation.  The  graduated 
taxer  believes  that  trusts  of  every  sort  must 
be  prohibited  or  else  there  can  be  no  genuine 
relief. 

The  single  taxer  contends  that  the  taxation 
of  factories  and  stores  acts  as  an  obstacle  to 
progress  by  discouraging  improvements  and 
extension  of  business. 

In  rebuttal  the  graduated  taxer  contends  that 
this  tax  does  not  act  thus  until  the  point  of 
greatest  efficiency  of  capitalization  has  been 
passed,  and  that  beyond  this  point  there  should 
be  a  tax  check,  because  the  concentration  of 
mercantile  and  manufacturing  plants  is  as 
dangerous  as  the  concentration  of  land  owner- 
ship. 

Between  the  single  tax  and  the  graduated 
tax  there  is,  then,  this  difference :  the  former 
is  intended  to  act  as  a  check  to  monopoliza- 
tion of  land  only ;  the  latter  as  a  check  to  mon- 


104     A  CURB  TO  PREDATORY  WEALTH. 

opolization  throughout  the  entire  realm  of  in- 
dustry. This  is  not  a  variance  in  principle, 
but  merely  difference  of  opinion  as  to  the  ex- 
tent of  application  of  the  principle. 

The  theory  of  the  tariff  also  is  fundamentally 
identical  with  the  graduated  property  tax,  as 
we  have  shown;  in  fact  the  tariff,  the  single 
tax  and  the  graduated  property  tax  could  well 
be,  with  certain  alterations,  incorporated  into  a 
unified  system  of  protection. 

Any  tax,  whether  it  be  the  uniform  tax,  the 
graduated  tax,  the  single  tax  or  the  tariff  must 
be  ultimately  paid  by  the  consumer,  for  taxes, 
like  other  items  of  expense,  must  be  added  to 
the  cost  of  production.  But  with  free  com- 
petition in  trade,  which  would  be  effected  by 
a  graduated  property  tax,  the  consumer  would 
pay  no  more  than  the  tax  and  what  he  did  pay 
would  go  into  the  public  treasury  for  his  own 
and  the  general  good. 

Grounded,  therefore,  as  they  are,  upon  the 
same  fundamentals,  the  protective  tariff,  the 
progressive  tax  and  the  single  tax  should  not 
be  in  conflict.  The  partisans  of  these  respec- 
tive systems  need  to  realize  this  fact  and  to 
unite  in  a  common  effort  to  put  into  effect  a 
scheme  to  simplify  the  whole  great  question  of 
taxation  and  act  for  the  greatest  good  for  all 
classes  of  men. 


CHAPTER  XX. 

THE  GRADUATED  TAX  AND  THE  PROTECTIVE  TARIFF. 

When  we  consider  the  protective  tariff  we 
find  the  same  principles  exemplified  that  form 
the  foundation  of  the  graduated  tax.  We  find, 
further,  that  the  protective  tax  works  success- 
fully, and  that  fact  should  predispose  us  in 
favor  of  the  progressive  taxation  of  property. 

In  the  first  place,  both  the  protective  tariff 
and  the  graduated  tax  are  discriminating  taxes, 
in  that  they  fall  more  heavily  upon  some  than 
upon  others  similarly  producing  or  selling. 
The  former  discriminates  against  foreign  man- 
ufacturers, with  the  design  of  preventing  the 
monopolization  of  the  American  market  by 
foreigners.  The  latter  discriminates  against 
excessive  capitalization  in  the  home  industries, 
with  the  design  of  preventing  the  monopoliza- 
tion of  the  American  market  by  a  small  group 
of  Americans. 

In  the  second  place,  the  effects  of  the  two 
systems  of  discrimination  are  the  same,  The 
105 


106      A  CURB  TO  PREDATORY  WEALTH. 

imposition  of  the  tariff  necessitates  an  addi- 
tion to  the  price  of  the  imported  article;  this 
in  turn  places  the  foreigner  at  such  commer- 
cial disadvantage  to  the  home  capitalist  that  he 
cannot  undersell  the  latter,  get  control  of  the 
market  and  plunder  at  will  the  people  of  the 
country  into  which  he  imports  his  goods.  On 
the  other  hand,  the  graduated  tax  necessitates 
an  addition  to  the  price  of  the  commodities  of 
the  home  monopolies  which  in  turn  places  the 
monopolists  at  such  disadvantage  in  the  market 
in  their  rivalry  with  independent  capitalists 
that  they  cannot  undersell  the  latter  and  get 
control  and  thereafter  plunder  the  people  at 
will. 

That  the  tariff  is  confined  to  the  product 
while  the  graduated  tax  is  intended  to  be  levied 
upon  the  capital  or  property  from  which  the 
product  is  derived,  such  as  the  land,  mine,  or 
building  and  machinery  of  the  factory,  does 
not  alter  the  fact  that  the  two  systems  are  one 
in  principle  and  purpose  and  would  be  the 
same  in  result.  We  confine  the  tax  to  the 
product  in  the  case  of  the  tariff  because,  as 
we  have  no  right  to  go  beyond  our  territorial 
borders  to  levy  taxes,  the  product  alone  is 
available  and  that,  too,  only  as  it  passes  over 
our  lines  as  imports  into  our  country. 

Within  the  bounds  of  our  own  country,  how- 


A  CURB  TO  PREDATORY  WEALTH.      107 

ever,  we  have  access  to  every  form  of  property. 
Capital  is  the  proper  object  of  taxation,  there- 
fore, for  the  reason  that  to  collect  it  from 
products  would  require  a  system  of  custom 
houses  similar  to  but  more  elaborate  than 
those  in  use  for  the  tariff,  while  if  levied  upon 
the  capital  the  tax  could  be  collected  just  as 
the  direct  taxes  are  now,  and  without  any  extra 
expense  or  difficulty. 

The  question  may  now  be  asked:  "Has  the 
taxation  in  the  form  of  tariff  on  imports  proved 
itself  to  be  a  success?"  Experience  dictates 
that  the  answer  should  be  in  the  affirmative. 
This  tax  has  obliged  the  foreigners  to  abandon 
their  schemes  of  encroachment  and  to  permit 
new  industrial  enterprises  in  our  land  to  spring 
up  and  flourish. 

The  graduated  tax  in  operation  would  prove 
itself  to  be  just  as  effective  as  the  tariff  has 
been.  It  would  oblige  American  capitalists  to 
dissolve  their  combines  and  abandon  the  ring 
system  for  the  more  honest,  helpful  and  suc- 
cessful system  of  competition. 

An  exclusive  market  against  outsiders,  with 
free  competiton  within  for  the  adjustment  of 
prices,  was  the  ideal  sought  by  the  early 
champions  of  protection.  It  was  not  expected 
that  home  industries  thus  protected  would 
combine   to   set   arbitrary  prices.     Alexander 


108      A  CURB  TO  PREDATORY  WEALTH. 

Hamilton  said  in  speaking  of  the  benefits  of 
protection,  "When  a  domestic  manufacture  has 
attained  to  perfection,  and  has  engaged  in  the 
prosecution  of  it  a  competent  number  of  per- 
sons, it  invariably  becomes  cheaper.  Being  free 
from  the  heavy  charges  which  attend  the  im- 
portation of  foreign  commodities,  it  can  be 
afforded  cheaper,  and  accordingly  seldom  or 
never  fails  to  be  sold  cheaper,  in  process  of 
time,  than  was  the  foreign  article  for  which  it 
was  a  substitute.  The  internal  competition 
which  takes  place  does  away  with  everything 
like  monopoly,  and  by  degrees  reduces  the  price 
of  the  article  to  the  minimum  of  a  reasonable 
profit  on  the  capital  employed.  This  accords 
both  with  reason  and  with  experience." 

Hamilton  expected  competition  at  home  in- 
stead of  monopoly,  and  supposed  that  in  pro- 
viding against  foreign  monopolists  nothing 
more  was  necessary.  It  did  not  occur  to  him 
that  it  was  as  easy  for  monopolists  to  grow  up 
in  America  as  it  was  for  them  to  grow  else- 
where. 

Horace  Greeley  said:  "But  with  what  rea- 
son, with  what  justice,  does  any  one  say  that  an 
import  or  tax  on  imported  goods,  iron,  or  nails, 
cloth,  or  cutlery,  creates  a  monopoly?"  Greeley 
did  not  look  for  monopoly  to  succeed  competi- 
tion.    He   believed  that  there   were  persons 


A  CURB  TO  PREDATORY  WEALTH.      109 

abroad  who  would,  if  not  held  in  check,  pre- 
vent free  competition  between  us  and  them, 
but  it  did  not  occur  to  him  that  persons  would 
rise  up  within  our  boundaries  and  take  the 
place  of  those  abroad.  Human  nature,  how- 
ever, is  the  same  everywhere,  and  if  the  cor- 
poration across  the  line  must  be  restrained, 
the  corporation  with  similar  tendencies  on  this 
side  of  the  line  must  also  be  restrained. 

A  protective  tariff  goes  only  half-way  in  the 
right  direction.  It  needs  to  be  supplemented 
by  a  graduated  tax,  which  may  be  termed  an 
inland  tariff.  Unsupported  by  such  internal 
provision,  it  is  fraught  with  danger.  When 
we  create  a  protective  tariff  and  rest  at  that 
it  is  equivalent  to  saying  to  others:  "Begin 
your  vocations  within  our  domain,  and  we 
will  protect  you  against  encroachments  from 
abroad;  we  shall  do  still  more,  we  will  assure 
you  of  the  permission  of  the  people  at  home 
to  prey  at  will  upon  them."  Or,  it  amounts 
to  declaring  to  would-be  plunderers  from 
abroad :  "You  dare  not  harass  our  people  from 
where  you  stand ;  come  across  the  line  with 
your  institutions,  and  we  will  issue  you  a  gen- 
eral license  to  pillage  and  oppress."  To  carry 
out  completely  the  purpose  of  a  protective 
tariff,  we  must  make  it  impossible  for  persons 
to  accomplish  within  our  borders  what  they 


110     A  CURB  TO  PREDATORY  WEALTH. 

are  powerless  to  do  from  the  outside.  While  a 
tariff  must  be  established  to  shield  us  against 
the  designs  of  predatory  combinations  abroad, 
the  graduated  tax  must  be  applied  to  prevent 
the  existence  of  predatory  combinations  at  home. 
The  gist  of  the  matter  is  set  forth  in  proposi- 
tion Six. 


PROPOSITION   SIX. 

The  submission  of  the  people  to  exploitation  at 
home  when  they  have  prevented  exploitation 
from  abroad  is  an  absurd  submission,  because 
the  plunderer  at  home  is  as  hurtful  to  us  and  as 
easily  tax-curbed  as  the  foreign  plunderer. 


CHAPTER  XXL 

THE  QUESTION  OF  CONSTITUTIONALITY. 

It  is  averred  that  the  graduated  tax  is  uncon- 
stitutional. Then  what?  Is  the  constitution 
God-made  or  man-made?  If  the  latter,  then 
may  it  not  have  been  ill-made  in  some  re- 
spects? And  if  we  come  to  this  conclusion 
may  we  not  concede  that  it  may  be  unmade  of 
some  of  its  defects?  Is  the  constitution  to  re- 
main the  only  thing  unchangeable  in  this  age 
of  progress  and  social  evolution? 

But  let  us  examine  into  the  alleged  uncon- 
stitutionality of  the  graduated  tax.  What  is 
the  fundamental  requirement  of  the  national 
and  of  the  state  constitutions  as  a  rule  as  to 
taxation?  Is  it  not  equality?  What  kind  of 
equality  do  we  desire,  simulated  or  real?  If 
the  latter,  the  graduated  tax  should  be  adopted 
for  it  is  the  only  system  which  makes  real 
equality  possible.     Let  us  look  at  the  facts. 

The  graduated  system  imposes  a  higher  rate 
per  cent,  of  tax  on  a  large  than  on  a  small  cap- 
113 


114      A  CURB  TO  PREDATORY  WEALTH. 

italization,  but  the  large  investment  affords 
opportunity  for  recoupment  sufficient  to  make 
a  fair  profit  when  it  forms  a  natural  monopoly 
through  being  of  the  size  we  have  designated 
as  capitalistic  adequacy.  That  is,  as  no  con- 
cern of  small  capital  can  compete  in  a  busi- 
ness that  requires  large  capital,  the  power  on 
the  part  of  the  large  concern  to  reimburse 
itself  for  its  increased  taxation  by  adjusting 
the  selling  price  of  the  product,  equalizes  the 
burden  of  the  taxation. 

It  is  because  the  graduated  tax  will  conduce 
to  this  uniformity  of  profitableness,  that  it 
must  be  adopted  before  there  can  be  equity  in 
taxation.  For  equality  in  the  rate  of  profit- 
ableness of  investments  or  vocations  is  the  im- 
portant and  true  test  as  to  whether  the  taxes 
have  been  just — have  borne  with  like  weight 
on  all  who  have  borne  them.  When  the  con- 
ditions are  such  (as  they  are  under  the  do- 
minion of  the  trusts)  that  one  man's  business 
yields  him  twenty  or  thirty  or  more  per  cent. 
on  his  investment  of  energy  and  capital,  while 
another  is  obliged  to  content  himself  with  a 
mere  fraction  of  that  or  with  no  profit  at  all, 
it  is  folly  to  talk  of  a  uniform  rate  of  taxation 
being  an  equitable  tax.  It  is  a  sham  of  the 
worst  type. 

Equal  in  that  it  conduces  to  a  situation  in 


A  CURB  TO  PREDATORY  WEALTH.      115 

which  there  is  an  evening  of  the  rate  of  profit 
through  recoupment,  the  graduated  tax  is,  in 
truth,  the  tax  which  the  principle  of  equality 
demands. 

Why  talk,  then,  of  amendment  to  the  con- 
stitution. Why  not  amend  the  system  of  tax- 
ation so  as  to  bring  it  really  within  the  con- 
stitutional requirement? 


CHAPTER  XXII. 

SUBSIDIARY  REASONS  FOR  THE  GRADUATED  TAX. 

Reasons  other  than  the  need  of  regulating 
trusts  may  be  given  why  taxation  should  be 
made  progressive.  These  may  be  mentioned: 
Large  wealth  is  better  able  to  pay  taxes  than 
small  wealth,  in  a  relative  as  well  as  an  abso- 
lute sense.  A  man  worth  five  million  dollars 
does  not  "feel"  his  taxes  as  sharply  as  a  man 
worth  five  thousand. 

Large  wealth  imposes  a  relatively  heavier 
expense  for  the  preservation  of  the  peace.  Ag- 
glomerations of  wealth  incite  crime  and  dis- 
order more  than  the  same  amount  of  wealth 
distributed  among  many.  It  follows  that  the 
benefits  that  large  wealth  receives  from  the 
maintenance  of  good  order,  and  indeed  from 
public  expenditures  in  other  directions,  are 
worth  more  to  it,  dollar  for  dollar,  than  they 
are  to  smaller  wealth. 

The  dollar  of  large  wealth  is  more  potential 
for  profit  making  than  the  dollar  of  small 
116 


A  CURB  TO  PREDATORY  WEALTH.      II7 

wealth.  There  are  more  profitable  invest- 
ments open  to  a  man  with  five  millions  to  in- 
vest than  to  one  with  only  five  thousand. 

These  are  some  of  the  factors  which  may  be 
accepted  as  corroborative  of  the  necessity  of 
making  taxes  progressive,  but  they  are  of  trifl- 
ing importance  in  comparison  with  the  regula- 
tion of  the  trusts.  For  without  the  abolition 
of  the  monopolies  no  gain  can  accrue  to  the 
common  people  by  saving  through  a  lighter 
ratio  of  tax  levy.  Because,  possessing  the  ex- 
traordinary power  to  dictate  terms  of  trade  in 
their  dealings  with  the  public,  the  monopolists, 
by  price  manipulation,  would  exact  from  the 
people  what  they  might  have  to  pay  in  taxa- 
tion. Permit  them  to  dodge  a  portion  of  their 
taxes,  as  we  are  now  in  the  habit  of  permitting 
them  freely  to  do  under  our  theoretically  equal- 
pay  system,  and  there  is  less  they  would  be 
obliged  to  take  to  satisfy  their  greed  for  profit. 
Require  them  to  pay  more,  and  they  would 
easily  make  it  up  in  the  machinations  of  trade. 
It  would  be  the  same  thing  in  the  long  run. 
What  the  graspers  failed  to  withhold  at  one 
point  in  the  distribution  of  the  country's  earn- 
ings they  would  withhold  at  another.  This 
being  the  case,  it  would  be  folly  to  look  for 
benefit  from  a  graduated  taxation  that  was  not 
at  the  same  time  a  suppressor  of  monopoly. 


118      A  CURB  TO  PREDATORY  WEALTH. 

A  more  cogent  subsidiary  reason  for  the  pro- 
gressive tax  than  any  of  the  foregoing  minor 
reasons  is  that  contained  in  its  equalizing  func- 
tion. As  previously  stated,  the  competition 
produced  in  consequence  of  the  prohibition  of 
monopoly  would  set  in  motion  a  reimbursing 
process  v^hich  would  entirely  efface  the  ap- 
parent disparity  between  the  heavier  and  the 
lighter  taxes.  It  would  occur  simultaneously 
with  the  influence  which  brings  about  an  equal- 
ization of  profitableness,  and  were  there  no 
other  feature  than  this  in  favor  of  the  progres- 
sive tax,  it  alone  would  be  sufficient  to  justify 
the  adoption  of  the  measure.  For  in  no  other 
way  can  there  be  equality  of  taxation. 

An  additional  point  that  recommends  the  au- 
tomatically equalizing  process  inherent  in  the 
progressive  tax  is  that  it  removes  all  taint  of 
hardship  from  taxation.  For,  be  it  understood, 
taxation  is  not  in  the  abstract,  regardless  of 
condition,  a  hardship.  It  is  so  only  by  being  mis- 
placed and  fastened  upon  wrong  shoulders. 
Justly  applied,  it  is  of  the  nature  of  an  invest- 
ment. In  order  to  elucidate  this  idea  let  us 
examine  briefly  the  immediate  and  specific 
reasons  for  taxation.  They  are  to  be  found 
in  the  execution  of  certain  undertakings  by 
public  instead  of  private  efifort,  such  as  the 
maintenance  of  the  general  order,  preservation 


A  CURB  TO  PREDATORY  WEALTH.      II9 

of  the  public  records,  building  of  the  highways, 
support  of  the  common  schools,  and  other 
public  utilities. 

These  services  are  just  as  essential  to  our 
welfare  as  those  we  undertake  privately  for 
our  more  personal  needs.  As  taxation  is  the 
system  employed  for  the  payment  of  them  it 
is  no  more  in  the  nature  of  a  hardship  then, 
than  the  payment  for  a  day's  work,  a  suit  of 
clothes,  a  doctor's  visit,  or  any  other  thing  of 
service  or  value.  The  situation  in  a  nutshell 
is  this :  as  there  are  some  services  which  can  be 
performed  more  economically  and  satisfactorily 
as  public  affairs  than  as  private  affairs,  it  is  of 
advantage  to  have  them  performed  in  a  public 
manner  and  the  expense  provided  for  from  a 
public  fund. 

Looked  at  in  this,  its  proper  light,  taxation 
must  be  admitted  to  be,  as  a  thing  in  itself,  a 
benefit  instead  of  a  burden,  and  that  equalizing 
factor  of  the  progressive  system  which  saves 
the  tax  from  being  a  hardship  in  any  part 
or  degree  commends  the  system  to  us  on  that 
account. 

So  much  for  the  merits  of  the  equalizing 
feature.  But,  as  in  the  case  of  the  other  sub- 
sidiary features,  the  principle  would  be  fruit- 
less of  positive  gain  if  put  into  practice  in 


120      A  CURB  TO  PREDATORY  WEALTH. 

any  way  without  the  abolition  of  the  monopo- 
lies. For  the  graspers  would  negative  all  the 
benefits  that  might  accrue  to  the  common  peo- 
ple by  their  manipulations  in  price  fixing. 


CHAPTER  XXIII. 

QUESTIONS  ASKED  AND  ANSWERED. 

'(1.)     What  is  the  precise  rate  of  increase 
that  should  be  adopted  with  the  pro- 
gressive property  tax? 
The  lowest  rate  that  will  suffice  to  bring 
about  and  maintain  the  optimum  of  size  in 
industrial  establishments.    To  increase  the  rate 
unduly  would  tend  to  encourage  smallness  of 
enterprise  at  the  expense  of  that  enlargement 
essential  to  economical  and  successful  opera- 
tion.    Judgment  and  experience  must  be  de- 
pended upon  to  bring  the  rate  to  the  required 
standard. 

(2.)     How  are  values  of  stockholdings  in 

corporations   to   be   taxed   where   the 

face  value  does   not  equal     the  real 

value? 

To  accomplish  the  purpose  of  the  graduated 

tax,  if  the  face  value  exceeds  the  real  value,  the 

stock  should  be  taxed  at  the  face  value.     By 

this  means  the  water  will  be  squeezed  out  of 

121 


122      A  CURB  TO  PREDATORY  WEALTH. 

the  stock  and  the  shares  reduced  to  the  actual 
value  of  the  property  represented.  If  the  face 
value  is  less  than  the  real  value,  the  real  value 
should  be  found  by  means  of  a  physical  valua- 
tion and  the  property  taxed  at  this  real  value. 
In  that  way  we  would  avoid  nullifying  the  cor- 
rective effects  of  a  graduation  in  the  tax  by 
undervaluation. 

(3.)     Under  a  strictly  competitive  system, 
how  is  the  heavily  bonded  corporation 
to  exist  along  with   the   rival  which 
is  free  from  debt? 
An  ordinary  way  out  of  the  difficulty  is  for 
the  bondholders  to  cancel  their  debt  by  taking 
over  the  property  and  obtaining  the  interest 
on  their  money  through  stockholding  instead 
of   bondholding.      This   would    convert   bond- 
holding  interests  into  actual  ownership  inter- 
ests and  relieve  the  public  from  paying  two 
dividends,  namely,  dividends  on  the  stocks  and 
dividends,  in  the  form  of  interest,  on  the  bonds. 
(4.)     How  would  the  change  from  combined 
industries  in  selected  centers  to  that  of 
smaller   industries   widely   distributed 
affect  the  railroads? 
Long  hauls  of  certain  kinds  of  goods  would 
be  less  numerous,  but  the  money  loss  would 
be  more  than  replaced  by  the  increased  num- 
ber of  short  hauls  of  the  same  goods.    The  gen- 


A  CURB  TO  PREDATORY  WEALTH.      123 

eral  prosperity  of  the  people  would  result  in 
increased  passenger  traffic  also.  The  demand 
for  all  classes  of  goods  would  be  so  much 
larger  that  the  volume  of  through  freight  traf- 
fic would,  together  with  that  of  local  traffic, 
be  vastly  increased. 

(5.)     How   would    the   graduated    property 

tax  affect  public  expenditure? 
Prosperity  would  become  general,  public 
debts  would  be  extinguished,  and  the  necessity 
for  government  restriction  and  control  would 
be  reduced  to  the  minimum.  As  a  result,  the 
taxes  would  be  very  moderate — so  low,  in  fact, 
as  to  cause  the  progressive  tax  to  be  looked 
upon  more  as  a  check  to  immense  combination 
than  as  a  means  of  raising  revenue. 

(6.)     Will  the  common  people  be  losers  from 
the  necessity  of  large  operators  to  add 
to  the  price  of  their  commodities  in 
order  to  make  up  for  the  extra  taxa- 
tion? 
Not  at  all.    Any  additions  to  the  prices  will 
revert  as  taxes  to  the  public  treasury  and  there- 
by relieve  the  people  of  just  so  much  assessed 
taxation  which  they  would  otherwise  have  tO 
pay.    Then  in  this  connection  we  must  remem- 
ber that,  although  the  large  industries  would 
be  obliged  to  advance  the  prices  on  their  pro- 
ducts by  reason  of  the  new  system  of  taxation, 


124      A  CURB  TO  PREDATORY  WEALTH. 

the  increase  would  in  no  case  be  as  great  as  the 

extra  charges  the  combines,   unrestrained  by 

competition,  are  at  present  forcing  us  to  pay. 

(7.)     Is  it  a  function  of  the  taxing  power  to 

regulate  industries? 
It  is  constantly  so  used  in  the  application  of 
the  tariff,  subsidies,  excise  duties,  etc. 

(8.)     Is  the  tax  barrier  to  be  raised  against 

the  untainted  as  well  as  the  tainted 

large  fortune? 

Unquestionably  yes,  since  the  discrimination 

is  confined  strictly  to  limiting  over-size  in  favor 

of  adequate  size. 

(9.)     But    will    not    the    capitalization    un- 
avoidably   large   be   hampered   in    its 
necessary    workings    because    of    the 
weight  of  the  tax? 
Assuredly   not,   for   the   reason   that   while 
none  could  overcharge,  owing  to  the  competi- 
tion between  them,  the  industries  necessarily 
large  could  make  their  selling  prices  greater 
to  the  degree  required  to  recoup  for  the  ex- 
cess tax,  because  all  large  industries  would  be 
similarly    circumstanced    as    to    the    supple- 
mentary expense  and  the  necessity  to  meet  it. 
(10.)     Should  earnings  be  taxed? 
They   should   not,   because   industry   would 
thereby  be  discouraged.    Tax  the  capital  from 
which  the  earnings  are  derived,  and  the  capital 


A  CURB  TO  PREDATORY  WEALTH.      125 

will  be  forced  into  activity  to  get  the  means 
with  which  to  pay  the  tax,  enterprise  will  not  be 
punished  for  the  benefit  of  negligence,  and  in 
time  much  of  the  earning  will  become  capital 
and  subject  to  taxation  as  such. 

Upon  this  plan  the  farmer  will  pay  tax  upon 
the  value  of  his  land,  stables,  work  horses, 
machinery,  tools,  and  seed,  but  nothing  upon 
the  crop  of  his  soil.  The  merchant  will  pay 
upon  his  store  building  and  the  average  value 
of  stock  carried,  but  nothing  upon  the  amount 
of  business  done.  The  manufacturer  will  pay 
upon  the  value  of  his  plant  and  amount  of 
raw  stock  kept  on  hand,  but  nothing  upon  his 
finished  products.  Such  placing  of  the  tax 
would  induce  wise  investment  of  the  resources 
at  command. 

(11.)  Would  this  plan  of  dealing  with 
wealth  end  the  strife  between  capital 
and  labor? 

Yes.  By  enriching  all  in  common  the  grad- 
uated tax  would  merge  the  interests  of  capital 
and  labor  and  leave  no  discrepancies  for  cause 
of  dispute. 

(12.)  Would  the  graduated  tax  originate 
any  new  duties  for  the  state? 

It  would  not.  Being  a  direct  tax  measure 
it  would  be  executed  the  same  as  is  the  present 


126     A  CURB  TO  PREDATORY  WEALTH. 

direct  tax  system  for  the  raising  of  the  rev- 
enue. 

(13.)  What  can  be  said  of  the  practicability 
of  this  remedy  as  compared  with 
penal  provisions? 
Unlike  the  fine  and  imprisonment  scheme, 
this  corrective  would  not  remain  inoperative 
unless  criminal  proceedings  were  instituted 
against  the  malefactors.  The  proposed  means 
would  be  in  constant  and  regular  operation. 
It  would  be  always  enforced  because  of  the 
certainty  of  collecting  a  tax  once  it  is  levied. 
It  would  be  easy  of  execution,  because  the  tax 
would  be  collected  just  as  the  present  taxes 
are.  The  reformation  would  be  automatic,  be- 
cause the  tax  would  render  monopolies  un- 
profitable and  thereby  lead  capitalists  of  their 
own  accord  to  rearrange  their  enterprises  on  a 
non-monopoly  basis.  It  would  prove  success- 
ful, because  self-operative. 

(14.)     Are   there   any  circumstances   under 
which  free  trade  could  be  safely  sub- 
stituted for  a  tariff? 
The  tariff  gates  could  be  safely  opened  be- 
tween nations  having  the  graduated  tax.    Until 
the   general   establishment  of  this   law,  how- 
ever, those  nations  adopting  it  would  have  to 
protect   themselves    from    the    monopolies    in 
countries    not   so   controlled,   by   establishing 


A  CURB  TO  PREDATORY  WEALTH.      127 

upon  their  boundaries  a  protective  tariff  dis- 
criminating against  the  products  of  the  latter. 
Should  we  impose  a  graduated  tax  and  remove 
our  tariff,  tax-dodging  monopolies  in  countries 
having  no  such  tax  would  soon  flood  us  with 
their  cheap  surpluses,  and  ruin  our  more  highly 
taxed  industries.  The  mere  existence  of  an 
ocean  or  a  boundary  line  between  us  and  for- 
eign monopolists  does  not  relieve  us  of  the  ne- 
cessity of  protecting  ourselves  from  them,  just 
as  we  must  protect  ourselves  from  monopo- 
lists at  home  if  we  are  to  have  free  competition 
and  natural  distribution. 

(15.)     Do  import  duties  rob? 

Import  duties  rob  nobody.  The  importer 
loses  nothing,  for  he  gets  his  money  back  by 
adding  the  duty  which  he  pays  to  the  price  of 
the  goods  when  he  sells  them.  The  people  lose 
nothing,  for  the  duties  go  into  the  public 
treasury  and  relieve  them  of  just  that  much 
direct  taxation.  The  robbery  which  does  take 
place  under  this  system  is  chargeable  to  the 
home  manufacturer,  who,  taking  advantage  of 
the  absence  of  effective  preventives  within, 
combines  with  others  to  cut  off  competition 
and  dictate  terms  of  his  own  making. 

(16.)     What  is  the  story  in  brief  ? 

The  evil  of  unnatural  distribution  of  wealth 
is   due   to   interfering  with  the   free  play  of 


128      A  CURB  TO  PREDATORY  WEALTH. 

natural  competition  among  producing  agencies. 

To  remedy  this  we  must  institute  a  system 
of  taxation  which  will  prevent  monopoly. 

The  same  taxation  which  provides  for  this 
freedom  of  competition  will  equalize  taxation 
by  equalizing  the  profitableness  of  all  branches 
of  industry. 

Institute  a  system  of  taxation  which  will 
prevent  monopoly  and  promote  the  free  play  of 
competition,  and  we  have  solved  the  problem 
of  industrial  welfare. 

We  shall  then  have  solved  it,  too,  by  the 
natural  and  only  mode  in  which  it  can  be  solved. 


CHAPTER  XXIV. 

SUMMARY  AND  CONCLUSION. 

We  have  now  explained  exactly  what  is  meant 
by  the  graduated  property  tax,  and  have 
shown,  without  too  much  technical  detail,  how 
the  tax  would  be  practically  applied.  We  have 
explained  how  the  specific  object  of  the  tax, 
the  dissolution  of  the  trusts,  would  be  accom- 
plished by  making  large  capitalization  unprofit- 
able. We  have  shown  that  the  trust  system  is 
based  on  an  economic  blunder ;  that  over-large 
combinations  do  not  make  for  the  greatest 
efficiency  in  production.  We  have  repeatedly 
pointed  out  the  injustice  of  the  present  sys- 
tem of  taxation,  and  we  have  proved  that  the 
graduated  system  would  be  fair  to  the  great 
capitalist  as  well  as  to  the  poor  man. 

We  have  noticed  that  the  graduated  tax  is 
based  on  a  natural  law  of  trade  that  is,  in  turn, 
a  corollary  of  a  fundamental  principle  of  human 
conduct.  These  are  competition  and  self-in- 
terest. We  have  pointed  out  that  the  trust 
129 


130     A  CURB  TO  PREDATORY  WEALTH. 

methods  disregard  the  law  of  competition,  and 
that  previous  attempts  at  curbing  the  trusts 
and  all  altruistic  schemes  for  regenerating  so- 
ciety have  alike  disregarded  the  principle  of 
self-interest. 

We  have  considered  the  graduated  tax  in 
connection  with  the  income  and  inheritance 
tax.  We  have  shown  the  identity  in  principle 
of  the  graduated  tax  and  the  single  tax,  and 
that  the  protective  tariff  and  the  graduated  tax 
are  mutually  supplementary.  We  have  also 
briefly  discussed  the  question  of  the  constitu- 
tionality of  the  proposed  law. 

The  brief  of  our  argument  is  this:  first, 
there  is  need  of  eome  means  of  reforming  our 
industrial  system ;  second,  the  proposed  instru- 
ment of  relief  is  the  best,  because  it  is  both 
theoretically  and  practically  efficient  and  no 
other  has  proved  to  be  so. 

Let  it  not  be  supposed  that  the  trusts  would 
tamely  acquiesce  to  the  adoption  of  this  meas- 
ure. It  is  quite  evident  that  in  a  movement  to 
found  a  graduated  taxing  system  a  struggle 
with  the  Interests  is  inevitable. 

Shrieking  for  tariff  protection  for  themselves 
against  foreign  encroachment,  they  will  de- 
claim against  graduated  tax  protection  for  the 
people  against  the  encroachment  at  home. 
Having  for  generations  by  their  tax-dodging 


A  CURB  TO  PREDATORY  WEALTH.      131" 

loaded  the  heavy  end  of  taxation  upon  the 
weaker  shoulders  of  the  common  people,  they 
will  stigmatize  as  confiscatory  the  proposal  to 
reverse  the  process  and  place  the  heavier  end 
upon  their  own  stronger  shoulders.  By  every 
imaginable  art  and  scheme  directed  against  an 
equitably  adjusting  graduated  tax  will  they 
display  their  unwillingness  to  compete  with 
the  people  on  equal  terms  in  all  branches  of 
industry. 

Nor  would  their  failure  to  defeat  the  gradu- 
ated property  tax  law  put  a  stop  to  their  oppo- 
sition. On  the  contrary,  it  would  only  be  the 
signal  for  the  calling  into  play  their  most 
powerful  ally  —  the  complacent  judiciary. 
Without  the  respect  for  the  law  which  the 
common  people  have,  and  which  alone  keeps 
their  ill-gotten  accumulations  from  reprisal, 
they  will,  in  their  attacks  upon  the  pockets  of 
the  people,  break  both  the  spirit  and  the  letter 
of  the  law  through  their  hired  attorneys  pro- 
moted to  the  bench  and  triply  invested  with 
the  functions  of  the  lawmaker,  court  and  ex- 
ecutive. 

Religious  liberty  was  not  obtained  overnight, 
nor  did  the  American  people  achieve  political 
liberty  without  a  struggle.  In  the  end,  how- 
ever, Truth  prevailed  precisely  because  that 
which  is  necessary  to  the  evolution  of  society 


132      A  CURB  TO  PREDATORY  WEALTH. 

is  Truth.  And  so  economic  liberty  shall  be 
obtained  by  the  people  of  the  United  States, 
because  the  exploitation  of  the  people  by  the 
money  power  means  the  economic  degradation 
of  the  people,  and  that  is  incompatible  with 
economic  evolution. 

Evolution  in  industrial  economics  must  go 
hand  in  hand  with  religious  and  political  evo- 
lution. If  our  country  has  achieved  liberty  in 
the  latter,  it  shall  also  achieve  liberty  in  the 
former.  And  our  country  means  not  the  Inter- 
ests but  the  people.  The  Interests  have  as- 
sumed for  the  time  being  the  bearing  of  in- 
dustrial over-lords,  but  the  people  are  begin- 
ning to  realize  that  industrial  feudalism  is  as 
intolerable  as  political  feudalism  and  that  our 
government  must  in  every  sense  be  a  govern- 
ment "of  the  people,  by  the  people  and  for  the 
people." 

The  unrest  apparent  throughout  all  classes 
in  the  United  States,  or,  for  that  matter, 
throughout  the  civilized  world,  is  an  indication 
of  a  feeling  that  we  are  at  the  threshold  of  a 
new  era.  It  is  the  duty  of  practical  men  to 
analyze  these  vague  tendencies,  to  recognize 
the  immediate  need  of  the  moment,  and  to  find 
the  remedy  that  shall  prove  to  be  a  true  one  in 
the  evolution  of  society. 

The  Pragmatic  philosophers  contend,  and  it 


A  CURB  TO  PREDATORY  WEALTH.      133 

cannot  be  successfully  controverted  in  its  ap- 
plication to  economics,  that  the  test  of  Truth 
is  "Does  it  work?"  The  graduated  property 
tax  zmll  work. 

Reduced  to  a  single  sentence  our  attitude 
toward  the  present  situation  of  industrial  eco- 
nomics may  be  stated  as  in  the  following 
proposition. 


PROPOSITION   SEVEN. 

The  submission  of  the  people  to  the  present  m- 
dustrial  conditions  is  an  indefensible  submis- 
sion, because  the  welfare  of  the  country  and 
the  happiness  of  our  children  are  at  stake  and 
the  means  of  reform  is  within  our  reach. 


A  CURB  TO  PREDATORY  WEALTH.      137 


A  SONG  FOR  LABOR  DAY. 

BY    WILL    M.    MAUPIN. 

I  have  builded  your  towns  and  cities, 

And  over  your  widest  streams 
I  have  flung  with  a  giant's  ardor 

The  web  of  strong  steel  beams. 
I  have  carved  out  the  busy  highways 

That  mark   where  your   commerce   reigns; 
With  hammer  and  forge  and  anvil 

I  have  wrought  your  golden  gains. 

I  have  girded  the   rock-ribbed  mountains 

With  rails  for  the  iron  steed; 
I  have  delved  in  the  old  earth's  bosom 

To  answer  the  great  world's  greed. 
I  have  clothed  you,  housed  you,  fed  you. 

For  thousands  of  years  gone  by; 
I  have  stepped  to  the  front  when  duty 

Has  called,  and  I've  answered  "I !" 

I  have  wrung  from  the  soil  denied  me 

Your  toll  of  the  golden  grains; 
I  have  garbed  you  in  silks  and  satins — 

And  fettered  my  limbs  with  chains. 
I  have  given  my  sweat  and  muscle 

To  build  for  you,  stone  on  stone. 
The  palace  of  ease  and  pleasure — 

The  hut  I  may  call  my  own. 


138      A  CURB  TO  PREDATORY  WEALTH. 

For  a  thousand  years  you've  driven— 

A  thousand  years  and  a  day. 
But  I,  like  another  Samson, 

Am  giving  my  muscles  play. 
My  brain  is  no  longer  idle; 

I  see  with  a  clearer  sight, 
And  piercing  the  gloom  about  me 

I'm  seeing,  thank  God,  the  light! 

I  see  in  the  days  before  me 

My  share  of  the  things  I've  wrought; 
See  Justice  no  longer  blinded. 

The  weights  of  her  scales  unbought. 
I  see  in  the  not  far  future 

The  day  when  the  workers  share 
Is  more  than  his  belly's  succor; 

Is  more  than  a  rag  to  wear. 

I  see  on  the  morrow's  mountains 

The  glints  of  a  golden  dawn; 
The  dawn  of  a  day  fast  coming 

When  strivings  and  hates  are  gone. 
Lo,  out  of  the  vastly  darkness 

That  fetters  my  limbs  like  steel 
I  can  hear  the  swelling  chorus 

That  sings  of  the  commonweal. 

For  a  thousand  years  you've  driven— 

For  a  thousand  years  and  one. 
But  I'm  coming  to  take  possession 

Of  all  that  my  hands  have  done. 
And  cities  and  towns  and  highways 

I've  builded  shall  be  mine  own; 
And  Labor,  at  last  unfettered, 

Shall  sit  on  the  kingly  throne. 


A   jew  Press  Notices   of   the   First  Edition. 

This  book  is  especially  planned  for  popular  read- 
ing. It  is  somewhat  conversational  in  style  and  all 
its  arguments  are  lucidly  presented.  Based  on  seven 
propositions  or  texts  stated  in  much  the  same  manner 
as  the  propositions  in  Euclid  the  question  is  well  ordered 
and  logical.  Though  readers  may  personally  disagree 
with  the  author's  premises  and  deductions  it  must  be 
admitted  that  the  "Curb  to  Predatory  Wealth"  is  a 
distinctly  useful  contribution  to  the  literature  dealing 
with  economic  and  financial  problems  and  deserves  a 
thoughtful  perusal. — Philadelphia  Evening  Telegraph. 

Whatever  the  political  economists  may  say  about 
Utopian  schemes,  it  cannot  be  argued  that  Mr.  Mar- 
shall simply  proposes  his  general  principle  and  then 
leaves  it  hanging  in  the  air  without  thought  of  ways, 
means  or  consequences.  He  takes  up  questions  of  man- 
ner of  assessments,  decentralization,  competition,  the 
right  of  capital,  the  right  of  self-interest,  tariff,  in- 
come and  inheritance  taxes,  and  subsidiary  questions 
of  various  kinds.  All  this  is  argued  under  seven  gene- 
ral propositions,  clearly,  succintly,  sanely,  in  a  book 
of  less  than  140  pages.  It  is  laid  in  moral  fairness, 
but  is  not  Socialistic. — Book  News  Monthly  (Phila- 
delphia). 

The  arguments  given  are  in  a  strong  convincing  man- 
ner, and  the  author  is  to  be  congratulated  upon  the 
style  of  his  work  and  the  strength  of  his  convictions. — 
Common  Sense,  Chicago,  111. 


The  tone  of  the  book  is  impartial  and  the  argument 
is  presented  in  terse  and  popular  phrasing. — ^Louisville 
Post. 

The  author  has  been  seeking  a  remedy  for  the  un- 
fortunate conditions  in  which  society  at  large  finds 
itself  growing  out  of  the  fact  that  on  one  hand  there 
are  a  scant  few  actually  rolling  in  a  superabundance 
of  wealth  and  on  the  other  millions  fighting  hard  to 
maintain  a  life  marked  by  self  denial  and  poverty, 
filled  with  sickness  and  sorrow.  He  believes  the  solu- 
tion is  to  be  found  in  a  change  of  the  present  system 
of  taxation.  For  the  existing  general  property  tax 
he  would  substitute  a  graduated  or  progressive  tax, 
providing  for  an  increase  in  the  rate  of  taxation  in  pro- 
portion to  the  increase  in  the  worth  of  owned  or  con- 
trolled wealth.  He  believes  it  would  spell  the  end 
of  the  domination  of  trusts  and  monopolies  by  render- 
ing it  unprofitable  to  effect  combinations  of  "predatory" 
wealth.  The  author  presents  his  plan  with  simplicity 
and  force. — States  (New  Orleans,  La.). 

Mr.  Marshall  argues  forcibly  against  monopolized 
production  and  marketing,  and  he  contends  that  his 
graduated  tax  would  be  followed  by  unfettered  com- 
petition of  wealth.  The  work  is  timely  and  interest- 
ing. The  author  makes  out  a  strong  case  for  his  theory. 
— Watson's  Jeffersonian  Magazine. 


THE  (iREATEST  HUMAN  PROBLEM  OF  THE  AGE 


A  PROPOSED  ADEQUATE  SOLUTION 
THE  HOWELL  SYSTEM 


BY. 

CHARLES  M. 


HOWELL 


Aathor  ol  "CoIosBal  Fortanes,"  "A  New  Economic  Sys- 
ttm,"  "A  National  Square-Deal  System,"  "A  National  Pros- 
perity System  for  All  the  People,"  etc. 

Financial  Benefit  to  95  per  cent.,  and  Justice  to  100  per 
cent.,  of  the  Population  of  the  Country. 

A   Proposed   System  —  Not  a  Mere  Theory  —  of  National 

Laws  £qually  Opposed  to  the  Illusive  Dreams  of  Socialism 

and  to  the  Lawless  Methods  of  Predatory  Wealth 

FOR  THE 

Inaui{uration,  Enforcement   and   Perpetuity  of 

ECONOMIC   LIBERTY. 

Ready  for  the  Electors  of  the  Entire  Country  to  Vote  on 
Whenever  They  are  so  Minded. 

If  the  Blessings  of  Prosperity  are  to  be  Restored  to  the 
People,  not  only  to  the  Laboring  and  Industrial  but  to  All 
Clastes,  then  the  Less  than  Five  Percent  of  the  Population 
Must  be  Legally  Prohibited  and  Prevented  from  Mis-appro- 
priating to  Themselves,  as  at  Present,  Practically  All  the 
Wealth,  Values  and  Credits  of  the  Country.  The  Unjustifiably 
Rich  Personal  Economic  Unit,  the  Centi -(hundred -times)  and 
the  Deci-Cten-times),  Millioaaire,  and  his  Type,  must  be  For- 
ever Eliminated. 

This  Result  will  be  Inevitably  Achieved  by  the  Adoption 
of  The  Howell  System  of  National  Laws,  and  it  also  will 
Produce  Revennes  from  SURPLUS  WEALTH,  Beginning 
with  $50.00  on  $100,000.00,  Sufficient  to  Run  the  United  States 
Government  and  Leave  an  ANNUAL  BALANCE  to  be  Ap- 
portioned and  Paid  Over  Yearly  to  the  Various  State  aud 
Territorial  Governments. 

The  Book,  in  Paper  of  Best  Quality  and  tn  Clear  Type,  with 

J 12  Pages  and  Cartoons,  has  been  Specially  Prepared  for 

Popular  Demand.    Subject  is  treated  tn  a  manner 

Readily  Understood  by  Any  One  who  can  Read. 

Price,  50  Cents  Postpaid;  Special  Rates 
TO  Book  and  News  Dealers  and  in  Quant- 
ities. Send  to  National  Square  Deal 
Club,  Berlin,  Pa.,  or  the  Author,  Chas. 
M.  Howell,  32  Broadway,  New  York  City. 


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